Description:
The Williams %R Range, also known as the Williams Percent Range, is a momentum indicator that oscillates between 0 and -100. It is designed to measure overbought and oversold levels in financial markets. Developed by Larry Williams, this indicator compares a stock’s closing price to its high-low range over a specific period, typically 14 days or periods.
Input Parameters:
- Length: Number of periods used in the calculation.
- Upper: Preset to -20 which represents the upper boundary of the indicator.
- Lower: Preset to -80 which represents the lower boundary of the indicator.
Use Case:
- Divergences: Divergence and convergence are also essential concepts when interpreting the Williams %R. When the indicator diverges from price action, it may signal a potential reversal. Conversely, when the indicator converges with price action, it may indicate that the current trend is likely to continue.
- Buy/Sell Signals: A long position might be considered when the indicator moves from below -80 to above -80, suggesting that the asset is no longer oversold. Similarly, a short position might be taken when the indicator moves from above -20 to below -20, indicating that the security is no longer overbought.
- Using with other indicators: It is advisable to combine the Williams %R with other technical indicators, such as moving averages or support and resistance levels, to increase the accuracy of trading signals.
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.
May 16, 2024