Bear Power

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Bear Power

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Bear Power determines the strength of buyers (bulls) vs. sellers (bears) as it measures the difference between the lowest price and a 13-period EMA. If the Bear Power indicator is below zero (Low < EMA), it means sellers were able to drive price below the EMA, and that’s negative. If the Bear Power indicator is above zero, it means buyers were able to drive the lowest price above the EMA, and that’s positive. Bear Power has a base value of 0 and has no lower or upper limit.

Divergences between bear power and prices indicate the best trading opportunities. This indicator is used together with a trend indicator (mostly Moving Average).   If trend indicator is up-directed and the Bears Power index is below zero, but growing, it is a signal to buy.