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Coppock Curve Trading Indicator
INTRODUCTION
The Coppock Curve is a momentum trading indicator which attempts to capture trending markets. Even though Edwin Coppock introduced the indicator in Barron’s in October 1965 for stocks, it can be applied to any market, from forex to stocks to commodities. Many indicators which determine trend are called directional indicators, meaning they show whether the market is in an uptrend or a downtrend. This indicator was originally designed to identify long-term buying opportunities in the S&P500 and Dow Industrials specifically on the monthly chart. In the S&P monthly chart below, the buying opportunity is triggered when the indicator moves from negative to positive territory above the zero line. One would exit a long position when the indicator moves from positive to negative territory below the zero line. These sell signals could be used to exit the stock market and move into cash, in order to reduce market exposure during bear markets.

While it was not used for sell signals, traders today have adapted this indicator for other markets besides the stock indexes and have used it for sell signals as well.

The calculation is as follows:

Coppock Curve = 10-period WMA of 14-period RoC + 11-period RoC

Where WMA = Weighted moving average and RoC = Rate-of-Change

Learn How to Use this Trading Indicator with lots of chart examples HERE >>>