Aroon Developed by Tushar Chande in 1995, Aroon is an indicator system that can be used to determine whether a stock is trending or not and how strong the trend is. "Aroon" means "Dawn's Early Light" in Sanskrit and Chande choose that name for this indicator since it is designed to reveal the beginning of a new trend. The Aroon indicator system consists of two lines, Aroon(up) and Aroon(down). It takes a single parameter which is the number of time periods to use in the calculation. Aroon(up) is the amount of time (on a percentage basis) that has elapsed between the start of the time period and the point at which the highest price during that time period occurred. If the stock is setting a new low for the given time period, Aroon(up) will be zero. On the other hand, if the stock closes higher than it has during the rest of the time period, Aroon(up) will be +100. For each subsequent period that passes without another new high, Aroon(up) moves down by an amount equal to (1 / # of periods) x 100. See ChartSchool article on Aroon and Aroon Oscillator.
