DeMarker Indicator - DeM Indicator
DeMarker Indicator Definition
The Demarker Indicator is a tool which was introduced by Tom DeMark to help identify emerging buying and selling opportunities. Demarker Indicator demonstrates the price depletion phases which usually correspond with the price highs and bottoms.
For more information how to set the indicator in the terminal please click here
The DeMarker indicator proved to be efficient at identifying trend break-downs as well as spotting intra-day entry and exit points.
How to Use DeMarker Indicator
DeMarker indicator fluctuates with a range between 0 to 1.
- DeMarker indicator is indicative of lower volatility and a possible price drop when reading 0.7 and higher.
- DeMarker indicator signals a possible price increase when reading below 0.3.
DeMarker Indicator Formula (Calculation)
The DeMarker indicator is the sum of all price increment values recorded during the "i" period divided by the price minima:
The DeMax(i) is calculated:If high(i) > high(i-1) , then DeMax(i) = high(i)-high(i-1), otherwise DeMax(i) = 0
The DeMin(i) is calculated:If low(i) < low(i-1), then DeMin(i) = low(i-1)-low(i), otherwise DeMin(i) = 0
The value of the DeMarker is calculated as:DMark(i) = SMA(DeMax, N)/(SMA(DeMax, N)+SMA(DeMin, N))
Where: SMA - Simple Moving Average;
N - the number of periods used in the calculation.
How to use DeMarker in trading platform
Use indicators after downloading one of the trading platforms, offered by IFC Markets.