Description:
The Welles Swing Index, developed by Welles Wilder, is a technical indicator designed to evaluate price change direction and price strength in relation to price swings.
Input Parameters:
n/a
Use Case:
- Short-Term Intraday Trading: Since the Swing Index focuses on the last two bars’ data, it is a popular tool among short-term intraday traders. These traders use the index to spot potential trends and capitalize on short-term price swings.
- Analyzing Market Sentiment: Another application of the Welles Swing Index is to analyze market sentiment. The index can provide valuable insights into the strength of Bulls or Bears in the market, helping traders determine when a shift in market sentiment may occur.
- Signal Identification: Traders can incorporate the Welles Swing Index into their trading strategies by using it as a signal for potential trend changes. When the Swing Index indicates a shift in price direction or strength, traders can consider opening or closing positions based on their analysis and risk tolerance.
This feature can be used in:
- Market Scanner
- Strategy Tester
- Multi-Factor Alerts
- Smart Checklist
Do you want to learn more? Check out our Learning Center Article.