An indicator that splits buying power and selling power into two lines, based on how far each candle’s high and low sit from an exponential moving average.
- Weapon tier
- Advanced
- Slots used
- Sub-charts 1/2
- Created by
- Alexander Elder
Concept
Two lines are drawn in a lower panel. The bullPower line is “the candle’s high − the exponential moving average of the last 13 closes”, and the bearPower line is “the candle’s low − the same average”.
The higher the high reaches above the average, the stronger the buyers’ push is taken to be; the deeper the low dips below it, the stronger the sellers’ pull. The average line itself is not drawn, only the two distances.
- bullPower
- bearPower
Charts by TradingView Lightweight Charts™
80 candles with volume, and the bullPower and bearPower lines in a lower panel. The price rises steadily from early on. Around candle 60 (↑) the price pauses, the bearPower line dips below 0 and then starts rising again, and after that the price climbs once more. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
↑ marks the candle where bearPower bottomed below 0 and turned up while the exponential average was rising. This chart was picked because the rise continued afterwards; sometimes a pullback simply turns into a decline. Drag the chart sideways with a finger or the mouse to move it, and pinch with two fingers to zoom in. With a keyboard, click the chart, then use ←/→ to move and +/− to zoom.
How it is calculated
Find the exponential moving average of the last 13 closes. It gives more weight to recent candles.
bullPower = the candle’s high − the exponential moving average. It is above 0 when the high is above the average.
bearPower = the candle’s low − the exponential moving average. It is below 0 when the low is below the average.
Its unit is the same as the price, so the more expensive the stock, the wider the two lines swing.
Parameters
| What it sets | Name in the game | Default | Range |
|---|---|---|---|
| Candles for the base exponential moving average | period | 13 | 2 – 100 |
Trading ideas
Pullbacks in a rising trend: while the exponential average rises, when bearPower dips below 0 and then starts to rise again, it is commonly read as a brief pullback within the trend coming to an end. The chart on this page shows that scene.
Bounces in a falling trend: the other way round, while the average falls, bullPower rising above 0 and then turning down is read as a brief bounce coming to an end.
Do not decide the trend from this indicator alone. Check which way the average is sloping with a moving average on the chart (lesson 3).
Common traps
- Where the trend is turning, a “pullback” can be the start of a decline. Check first whether the trend is still alive.
- One candle with a long wick can make both lines jump. Look at the shape over several candles rather than one.
- None of these are sure signals. Read them together with the trend and volume.
In the game
- “Elder-Ray Index” is an “Advanced” weapon and uses 1 of the “Sub-charts” panels (limit 2). Volume in the starting setup already uses 1, so adding it brings it to 2 (0 left).
- Because both lines move around 0, a zero line (dotted) is drawn in the panel too. The underlying average line is not drawn — to see it, equip “Exponential Moving Average” on the chart as well.
Related indicators and lessons
- Coppock Curve — A slow curve made by adding two rates of price change and smoothing them, used to spot where a rise begins at the end of a long fall.
- 3. Moving averages
- 2. Trends and sideways moves