Williams %R or Williams Percent Range

 Williams %R or Williams Percent Range

1. This type of momentum indicator moves between 0 and -100
2. Measures overbought and oversold levels. 
3. The period typically sets to 14. I prefer 28 as it will reduce the noise.
4. The best results are in a range market in which you can use both buy and sell signals

• An overbought or oversold reading doesn't mean the trend will change. Overbought means the price is close to the highs of its recent range, and oversold means the price is near to the lower end of its recent range.

The Williams %R may be used to find entry and exit points in the market. 

Signals:

In a range market:

Buy if the indicator moves out of the oversold area.

Sell if the indicator moves below the -20 (overbought) line.

In a downtrend market:

Do not buy

Sell if the indicator moves below the -20 (overbought) line.

In an uptrend market:

Buy if the indicator moves out of the oversold area. (Above -80)

do not sell.