CCI Indicator Trading Strategies

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The CCI indicator, the commodity channel index, is a momentum based indicator that falls under the oscillator classification. The CCI oscillates between several levels including:+100-1000+200-200These levels are often used as overbought and oversold levels. The +100 would be considered overbought as an example. A move below 100 would be used as an oversold condition.From there, traders expect a retrace in price and often look for reversal trades.Donald Lambert, the designed of the indicator, actually used extreme readings such as +100 or -100 as signs of a strong/weak market. He would then look to establish a trading position in that direction.While oversold and overbought levels were not the intention of the CCI, many traders in Forex use those market states as the basis for a trading strategy.
- See more at: www.netpicks.com/cci-commodit... FOR EDUCATIONAL AND INFORMATION PURPOSES ONLY; NOT INVESTMENT ADVICE. NetPicks Services are offered for educational and informational purposes only and should NOT be construed as a securities-related offer or solicitation or be relied upon as personalized investment advice. We are not financial advisors and cannot give personalized advice. There is a risk of loss in all trading, and you may lose some or all of your original investment. Results presented are not typical. Please review the full risk disclaimer: www.netpicks.com/risk-disclosure

[@jahmaismall7634]

The best indicator out there

[@kamallotus5456]

Really appreciate watching this setup. Thank you so much!

[@eykay_thebarber8563]

Amazing strategy, I'll consider Mark as a Trading Legend and may his soul rest in peace.. thanks for the video this information you shared is Golden.

[@sungyentsai4442]

Holy Moly Guacamole, I am so fortunate this channel exists. Thank you for this video. I watched it a couple of times to really sink in this concept.

[@Netpicks1]

Wow, thank you!

[@Tim-French]

Thank you for this informative video!

[@bbans1218]

Another great vid. Thanks!

[@efrainromero3959]

Osom! I thought I was the only one who use this way the CCI. Love the indicator. I personaly use 51 period on Weigthed and use the 0 level cross as signal to buy or sell. I´ve add a Moving average too at the CCI window to have reenter signals and the very same indicator gives me Divergence signals!!! it´s a marvelous indicator ;)

[@Netpicks1]

Thanks for sharing!

[@Osama-rm2id]

But how do you confirm 0 level buy sell signal confirmation

[@worldnews1545]

This is one of my holy Grail indicator.. with right parameters this is a holy Grail.. telling you this truth from my five years of experience..

[@stevenford6223]

what settings do you use?

[@pepitoton8363]

help parameters

[@timshen8310]

Very clear presentation 👍

[@Netpicks1]

Thanks Tim!

[@raymondbaloyi1318]

Thank you, sir. You have really made my day.

[@Netpicks1]

Glad I could help

[@satishshirke859]

Great review.

[@techgeek1162]

Great presentation and killer strategy. I was using Ichimoku with DMI. Now kicked out dmi and combined CCI(50) and CCI(14) as one indicator in 512 tick chart. Now it got even better. Man I got Lord Jesus and Lord Budha on a same table, now no body can't stop me. What took me so long to find your video, that is the hardest question I have to find answer this weekend. :) IT DOESN'T MATTER WHAT INSTRUMENT AND TIMEFRAME YOU USE. PROFIT WILL RUN AFTER YOU , YOU DON'T.

[@pepitoton8363]

help me please

[@Osama-rm2id]

How did you combine both

[@sarwan4422saru]

Excellent, perfect strategy it works 80-90 percent accurate. I was testing different strategies for 1 year but never found this accurate profitable successful and most important stress free. Thanks

[@jaretjardine3671]

Great video!

[@Netpicks1]

Thanks!

[@mouldikardous634]

very interesting video

[@hassanalqahtani7860]

Thank you very much for your vedio , it is useful

[@Netpicks1]

You are welcome

[@vitodifalco111]

great video!!!!! question though on CCI average setup for tradestation 9.5 there diiferent settings cci lenght default 14 cci avg legnth default 9 over sold default -100 over bought default 100 you mentioned using 50, 20 and 14 would that be cci legnth or cci avg legnth appreciate your help

[@Netpicks1]

I am referring to the length

[@bijaypradhan2107]

Thank you! Amazing explanation on CCI. Bit confused on one thing as I am a begineer..... I have set up CCI for 50 and 14 with 34 EMA and to get best result for short or long trade entry which chart gives better understanding Monthly, Daily or Hourly.

[@Netpicks1]

You want the timeframes to be in agreement with trend direction. However, your trading chart can become in agreement when your trade triggers. I take trades off all those time frames including weekly.

[@3D1969]

God bless you. Thanks

[@Netpicks1]

You too

[@asridamayanti7462]

Gems👍

[@barrbudo]

Hey, I have a question regarding the pull-back strategy. Let's say that I want to enter long: The 50 has to bounce off either the +100 or zero line, while the 14, which is going down, has to bounce off the zero line and to start going up towards the +75 line. Is that what you meant at 8:02 by "14 can bounce over the zero line to the opposite 75 level"? Thanks a bunch!

[@Netpicks1]

Hey Barbudo. That means the 14 does not have to stay on the same side of zero. A deeper 14 pullback just means that price has had a deeper retrace. Crossing back over the zero line can be used a trade entry trigger.

[@acemakaveli8212]

sir can i use this on 5 min tf? and in cryptocurrency? and what cci are you refering to when exiting +, - 100. the 50 period cci or the 14?

[@Netpicks1]

You are going to have to answer the 5 minute question for yourself. I personally don't trade low time frames and regardless of my experience, you should always test anything you plan to do. You CAN exit with the 50 but that is considered a trend change. Using the 14 as an exit trigger gets you out when momentum is against you. If trading 5 minute charts, I'd probably want to be out early so.....using the 14

[@acemakaveli8212]

@@Netpicks1 thank you so much sir.

[@matatik]

Very f.. Smart. Thank you!!!

[@Netpicks1]

Glad it was helpful!

[@custardclips7751]

Was mark braun one of the traders that was depicted in the big short movie?

[@Netpicks1]

Nope, not him.

[@achmadmuchtar2493]

I appreciate your kindness to share this information. Thanks. God bless you. And RIP for Mark in Heaven.

[@Netpicks1]

Thanks Achmad.

[@DisarMn]

Do you know the strike rate of the strategy you showed at 4:30? Seem's like a solid system.

[@Netpicks1]

I do...from my perspective and my approach with it. There are also nuances to it as well. That said, fire up your charts, roll in some past data, use your trading plan and test it out. It's the only way.

[@DisarMn]

​@@Netpicks1 iv'e been back testing a ton recently seeing what indicator combo is the best for trading divergences. From using the CCI, Volume, And specific candlestick patterns, i have a 45% SR with roughly a 2.5 R. Just been looking around seeing what other strategies people have based around the CCI.

[@Netpicks1]

Great to see others take the testing seriously! Do you look at other metrics such as E-Ratio or test with random and out of sample data? I find adding those, among others, can either point to ways to improve the strategy or dump it and start over. Here is an article we did a while back on some aspects of testing: www.netpicks.com/curve-fitting-back-testing/

[@igorzherebiatev5751]

Hi! But what if I buy when cci crossing up the -100 level and sell when crossing down the level 100 line?

[@Netpicks1]

Depends. Is it against the overall trend? If so, was there price exhaustion before the reversal? An increase in volume during the exhaustion? Some type of reversal pattern? I have taken reversals against the trend but there is always some type of imbalance that I can see and never just because of an indicator.

[@rafakoscinski5319]

I'm a little bit confused. In the presetnation you talk about the cci with levels of +100 and -100 when on the chart you have - 200 and +200. Next thing, you say on the start of a trend part, that CCI 14 should be below the zero line but in fact it is below the - 200 (which by the way you also mention in the presentation). This is of course also below the zero line as - 200 as a number is less then zero is that the idea? Later on in the video you speak about -75 level when earlier you don't mention it. This is an itresting video I wanted to use some indicator as an confirmation one to my own strategy and this looks like a good answer to that, but like I said I'm confused. I like things to be strict as I'm a large fan of semi automated trading and here I'm having problems with extracting hard rules which I need. Thanks for reading my comment and a really interesting video. Have a nice day. Regards

[@Netpicks1]

You want the 14 on the other side of zero when changing of trend happens. How far is irrelevant because we are just looking at a change of trend. The 75 level, + or - , is where you want a pullback in price to drive the CCI to.

[@navketan1965]

My experience is that for intraday forex trend trading most important relevant (Guide)trend direction is ON 15 minute, 1h and 4h charts only-- For intraday trading weekly & monthly trends do not matter much(too far removed from intraday field of activity) & can be ignored. For simplicity sake if 15 minute ,1h & 4h trends are in the same direction, you have a trade set up in the same direction (one could fine tune entry 0n 5 minute charts). In general if daily candle be in the same direction for any trade it is better but not A must.--Sir, what do you have to say ?

[@Netpicks1]

Correct...the weekly trend is not going to matter much for those trading a 15 minute chart. Usually 4-6X your trading time frame for trend which is about hourly chart. Taking a trade if there is a valid setup when the 15 turns in the direction of the 60-240 minute chart would make sense.

[@Hmannk]

That ema 34.. do you apply to simple or exponential??

[@Netpicks1]

Exponential.

[@sungyentsai4442]

E.M.A. (Exponential Moving Average)

[@guilhermehintz197]

Do you use the CCI in all time frames?

[@Netpicks1]

You can however keep in mind that lower time frames have more noise.

[@suhassaptak]

Which time frame used in this video?

[@Netpicks1]

240 minute chart - 4 hours

[@dragonoixgaming585]

Is it good in 10 minutes time frame? I know lower time frame means extra noises

[@Netpicks1]

Best thing to do.....put it on the chart you are interested in and see how it reacts.

[@jafxtradinginstitute6395]

Can work on all tf . You just have to know how to use the indicator. On M1 look

[@jafxtradinginstitute6395]

For a buy the CCI 14 cross the zero line the range at +100 then cross above 34ema and 50 cci cross zero level . Then loss of momentum on CCI back below zero level to -100 level for a pullback trade into the trend . This pullback is like 50-62% back to the high of the structure before buying again . My question which EMA could be used with 14 CCI ..is it 14 ema ? When price cross 14 ema . Cci cross zero level ? Let me check..

[@Netpicks1]

If you are using a 14 period CCI, you are essentially using a 14 period moving average on your chart. CCI is a detrended oscillator. You will see when the CCI line crosses the zero line, price is pretty much crossing the moving average on price.

[@jafxtradinginstitute6395]

@@Netpicks1 thanks I figured it out.. it's a cool strategy. Could you code a CCI with divergences and arrows and candle identify such as evening star. Morning star. Railroad track. Engulfing. Drakcrow . Whivh cci period give more accurate divergences? Could develop a system to trade divergences at oversold and overbought markets . Below -/+200 levels entry at swing points.

[@jafxtradinginstitute6395]

Reversal trade setup with divergence.

[@Netpicks1]

I could live with that type of setup.

[@nurulamintonmoy1273]

Does it work with Cryptocurrency? Some one please explain your experience. Also what does +100 -100 means? that if price goes +101 and so on or -101 or lower than it, is valid for this strategic entry?

[@Netpicks1]

The 100 zones are simply a way to measure how extended price is from, basically, a moving average. It's not a standalone trade entry. Work? Not sure what you mean by that.

[@nurulamintonmoy1273]

@@Netpicks1 tnx for thw reply. does it work it cryptocurrency i mean can this way we can analyse crypto chart and make entry ( use this method as confirmation)

[@Netpicks1]

While there are different drivers for instruments, the same approach can generally be used to trade them all. At the core, we are looking for either an imbalance of buyers/sellers (trends) or when both sides are in agreement (ranges). Finding a way to exploit either condition or the transition between the two, is the approach. There are many ways to accomplish the same thing

[@Hmannk]

Hai.. affective in which TF??

[@Netpicks1]

It is not time frame dependent but understand that lower time frames whip indicators around more frequently. Overall, indicators are only as effective as the trader using them

[@Hmannk]

@@Netpicks1 thankyou sir

[@Netpicks1]

Did you ever think there was "magic" in trading indicators? Let me know your thoughts.

[@philnewpower]

Yes I feel like there is a 'magic confluence' when using indicators in collaboration with each other. It appears to be working when different indicators work together with volume.. I've been back testing CCI for a few weeks, and I have to say in happy with the results! My strategy looks slightly different but fundamentally the same setup.

[@worldnews1545]

Yes

[@julesg7701]

Yikes, so confusing, I know this video was a while ago but it would be awesome if you did another but with more chart examples for the Pullback. I've tried following the logic but it's damn difficult. Thanks!

[@Netpicks1]

:) I can do that. In the meantime, when looking for a pullback in the CCII, we are simply using the +/- 100 lines as a MEASURE of the pullback/rally depth. That way, we can objectively state that price did indeed go through a pullback.

[@SSEnrich]

I don't like this indicator. It spends too much time at extremes. He does mention some new ways to trade ut here though. I will add the video in my playlist and look into this later if it can work.

[@Netpicks1]

The extremes on the CCI is no different than seeing how far away price is from the CCI setting. An extreme +100 of a 20 CCI is simply showing an extension from the average. It's a warning that price may be too extended and a slight pause/pullback could be coming.

[@twelvedozen5075]

Your combined CCI’s resemble “Woodies” CCI

[@Netpicks1]

CCI 50 comes from another trader and Woodie was only using the 14 at the time the other trader started to use 50.