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NIFTY

11504.95      -11.15 -0.10%

BANK NIFTY

30093.30      -260.95 -0.86%
ACC 1425.75 (1.15%) Link
Symbol     LTP Chng%
NATCOPHARM 890.80   + 15.20
RAJESHEXPO 509.35   + 10.75
DRREDDY 5333.35   + 10.48
SUVEN 56.45   + 9.51
CGCL 234.95   + 7.80
Symbol     LTP Chng%
ESSELPACK 251.85    -7.66
ORIENTELEC 202.30    -6.19
AEGISCHEM 233.20    -5.40
MAHINDCIE 122.30    -5.16
JINDALSAW 67.40    -5.00
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Commodity Channel Index (CCI)

Introduction

The Commodity Channel Index, first developed by Donald Lambert, quantifies the relationship between the asset's price, a moving average (MA) of the asset's price, and normal deviations (D) from that average.

The CCI is very popular amongst technical investors; today's traders often use the indicator to determine cyclical trends in not only commodities, but also equities and currencies.

Formula

CCI = (Typical Price - 20-period SMA of TP) / (0.015 * Mean Deviation)
Typical Price (TP) = (High + Low + Close)/3
Constant = .015

Advantage

CCI measures the difference between a security's price change and its average price change. High positive readings indicate that prices are well above their average, which is a show of strength. Low negative readings indicate that prices are well below their average, which is a show of weakness. The Commodity Channel Index (CCI) can be used as either a coincident or leading indicator.

Sample Calculation

Technical chart for CCI

Technical Indicators

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