The Aroon indicator has two lines. the Aroon up measures the number of periods since a High, and the Aroon down measures the number of periods since a Low. This is a trend recognition indicator.
The indicator is traditionally applied to 25 periods of data, however, I use different periods on different time frames. The smaller the period the noisier the indicator gets.
When the Aroon Up is above the Aroon Down, it indicates bullish price behaviour. When Aroon Up crosses above Aroon Down it means a new uptrend is starting. (This is not true 100% of the times as you will get many false signals at top of the good ones.
When the Aroon Down is above the Aroon Up, it signals bearish price behaviour.
Happy trading!
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