The ThomasDeMark Expert indicator, developed by Thomas DeMark, is a proprietary analysis technique based on his own indicators, namely the Range Expansion Index (REI), Sequential, and Channels. The REI is sensitive to periods of increasing or decreasing price action and almost silent during sideways markets. By evaluating the direction of the REI as well as its level in relation to the overbought and oversold zones, price action is interpreted.
Using the REI in conjunction with the Sequential, the ThomasDeMark Expert indicator is better able to qualify the REI’s value. Sequential is a method of determining when a market top or bottom will occur based on the relationship of closing prices. Sequential is bullish when 9 consecutive bars Close less than the closing price 4 bars ago. Conversely, Sequential is bearish when 9 consecutive bars close greater than the closing price of 4 bars ago.
The final part of this indicator is the DeMark Channel. These channels are calculated by averaging the highs and lows of each bar and offsetting these values so that they surround each bar. When the Close of a bar exceeds the channel, the market is likely to move back towards the channel.
This indicator consists of a combination of patterns and should be used as a guideline for confirming your own market interpretations as well as educate you as to how Thomas DeMark analyzes a market. The ThomasDeMark Expert indicator is comprised of three indicators allowing the Expert Commentary to determine when price direction changes so you can take advantage of swings in the market. |