What is Williams %R
Definition: The Williams %R is the most widely-used stock market technical indicator the world over. It is a statistical indicator, which indicates to traders and investors whether a stock is oversold or overbought. The indicator, therefore, enables participants in the stock market to make more precise and informed decision about buying or selling a particular stock.
Description: The Williams %R technical indicator was developed by Larry Williams in order to study the current price of a stock in relation to its historical trend, usually 14 days. It collates recent market prices and volume data to come up with precise forecasts about the price of the stock.
It is a momentum indicator similar to the stochastic oscillator. It helps traders and investors determine when to buy or sell a stock by providing them with triggers. It can, also, help ascertain whether a recent trend in the price of a stock will continue or revert to its original position.
The indicator is in the form of a graph with negative numbers in the range of 0 to -100 plotted on them. There are two horizontal lines drawn at -20 and -80. Those are your triggers to buy or sell.
The readings below the -20 line signals that a stock is overbought in the market whereas a reading above -80 signals that it is oversold. A trader observing the Williams %R graph will ¡®sell¡¯ the stock when the indicator slips below -20 while he will initiate a ¡®buy¡¯ if it goes above -80.
Another advantage of the Williams %R indicator is that it¡¯s extremely useful and profitable in markets that are trading sideways or non-trending. But in a trending market a Williams %R indicator is seen not to fare too well, eventually, leading to losses for traders and investors.
Description: The Williams %R technical indicator was developed by Larry Williams in order to study the current price of a stock in relation to its historical trend, usually 14 days. It collates recent market prices and volume data to come up with precise forecasts about the price of the stock.
It is a momentum indicator similar to the stochastic oscillator. It helps traders and investors determine when to buy or sell a stock by providing them with triggers. It can, also, help ascertain whether a recent trend in the price of a stock will continue or revert to its original position.
The indicator is in the form of a graph with negative numbers in the range of 0 to -100 plotted on them. There are two horizontal lines drawn at -20 and -80. Those are your triggers to buy or sell.
The readings below the -20 line signals that a stock is overbought in the market whereas a reading above -80 signals that it is oversold. A trader observing the Williams %R graph will ¡®sell¡¯ the stock when the indicator slips below -20 while he will initiate a ¡®buy¡¯ if it goes above -80.
Another advantage of the Williams %R indicator is that it¡¯s extremely useful and profitable in markets that are trading sideways or non-trending. But in a trending market a Williams %R indicator is seen not to fare too well, eventually, leading to losses for traders and investors.