📊 Percentage Price Oscillator (PPO)

The PPO is one of the most widely used trading indicators, considered by many experts to be the evolution of the MACD. It measures the percentage difference between two exponential moving averages, short-term and long-term, and is useful for identifying changes in price momentum.

When the oscillator is above the zero line, it indicates that the short-term moving average is above the long-term one, suggesting a bullish moment. When it is below, it suggests a bearish moment.

Formula: PPO = (short-term EMA – long-term EMA) / long-term EMA

Interpretations: Trading signals: crossovers between PPO and signal line identify entry/exit points. Trend confirmation: positive PPO suggests bullish trend, negative PPO suggests bearish trend. Divergences: divergences between PPO and price can indicate trend reversals. Momentum evaluation: the amplitude of the oscillation indicates the strength of momentum.