Rate of Change

Rate of Change

The Rate of Change or ROC is a non-bound oscillator that fluctuates above and below the zero line. It shows the difference between the current price and the price of n periods on a percentage form.

Calculation
ROC= (( Close-Close n periods ago))/(Close n periods)*100

When the price rises, the ROC surges, when then price declines, the ROC plunges. The ROC can also determine whether the security is already overbought or oversold. The higher the ROC, the more the security is overbought; the lower the ROC, the more it is oversold. However, like other indicators, ROC may generate whipsaws and so it is recommended to also use other indicators.

The ROC is very similar to the Momentum Indicator. The only difference is that Momentum uses the difference of the prices to calculate while the ROC uses a ratio of the prices.

This entry was posted in Price Indicators. Bookmark the permalink.

13 Responses to Rate of Change

  1. Lovely piece, thanks are in order for making the effort to throw it up

  2. I can’t say I completely agree, thanks are in order for making the effort to write it down

  3. Lovely piece, thanks to whoever thought of it and for showing the initiative to throw it up

  4. I can’t say I completely agree, kudos to you for taking the time to write it down

  5. Bert Stoehr says:

    Great ideas, kudos to you for having the initiave to throw it up

  6. I don’t agree with it, thanks to whoever thought of it and for making the effort to throw it up

  7. Fantastic ideas, props to you for taking the time to write it down

  8. I don’t agree with it, thanks for having the initiave to put it up

  9. I don’t agree with it, props to you for making the effort to come up with it

  10. Great ideas, thanks to whoever thought of it and for showing the initiative to come up with it

  11. Robin Gagel says:

    Lovely post, many thanks for having the initiave to put it up

  12. Mark Caprio says:

    Lovely ideas, thanks to whoever thought of it and for showing the initiative to think of it

  13. I fully agree with author opinion.

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>