DeMarker

The Demarker Indicator is for identifying high-risk buying or selling areas in a given market. It identifies price exhaustion and can be used to identify market tops and bottoms.

There are two variants of the Demarker Indicator, one bounded by values from -100 to 100 and the other by the values from 0 to 1, however this does not affect the principles of the Indicator.

The two main elements of the indicator are the DeMax and DeMin, which are then compared to determine the indicator value. The DeMax occurs when the current high is higher than the previous period’s high (if this is not the case then DeMax is 0), and the DeMin occurs when the current Low is lower than the previous period’s low (if this is not the case then DeMin is 0).

The indicator is the moving average of the DeMax divided by the sum of the DeMax and deMin, i.e.


=DeMax
(DeMax + DeMin)

Thus, the higher the value of the DeMax is relative to DeMin, the greater the value of the Demarker Indicator, and visa versa.

Signals (based on 0 to 1 scale) Values:

  • < 0.3Price will soon turn upwards
  • > 0.3 < 0.7Low risk period
  • > 0.7Price will soon turn downwards