The indicator generates 3 main up signals:
– Continuation of the uptrend. An uptrend has formed on the chart, and the rate of change line has crossed the zero level from the bottom up and is growing up.
– Trend reversal. To get this signal, you need to build overbought and oversold levels.
The signal to open a trade will be the exit of the ROC line from the oversold zone. This is a situation when the indicator begins to grow under the oversold level, crosses it from the bottom up and continues to go up.
– Bullish divergence.