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Cross: set outside to 1, and you only see stocks that were outside the zone yesterday and are inside it today. A trend that has just begun.
The Aroon Up and Aroon Down sliders: the minimum and maximum acceptable value, from 0 to 100. Aroon Up at 100 says the stock made a new high today; it says nothing about how big that high was.
Aroon indicator
The Aroon indicator measures how recently the stock made a new high, and how recently it made a new low. Not how fast it moved, not how far it is from its average, simply how long ago each extreme happened.
In Samurai, Aroon gives you three values:
In Samurai, Aroon gives you three values:
- Aroon Up: on a 0-100 scale, how recently the highest high of the lookback period occurred. A reading of 100 means the stock set a new period high on the current bar. The value then decays as that high recedes into the past, reaching 0 when the high is as old as the lookback allows.
- Aroon Down: the same measurement for the lowest low. 100 means a new period low was just set.
- Aroon Oscillator: Aroon Up minus Aroon Down, a single signed value from -100 to +100. Positive means the high is more recent than the low, so the uptrend dominates. Negative means the opposite. Near zero means neither side has the upper hand.
With the default 14-day length, each day that passes since an extreme takes roughly 7 points off that line. So an Aroon Up of 50 means the stock's 14-day high was set about a week ago.
Why use it?
Most indicators tell you about the size of a move. Aroon tells you about its freshness, and the two are not the same thing.
A stock can have strong momentum on paper while quietly failing to make a new high for two weeks. Aroon catches that immediately, because the moment a stock stops setting new highs, Aroon Up starts falling. It is unsmoothed and it reacts on the day the extreme is set, which makes it one of the earlier signals available for a change in trend.
But the real reason to use Aroon is that it separates two situations that look identical to almost every other indicator: the quiet market and the violent one.
Both can show no net trend. The difference is what is happening underneath:
A stock can have strong momentum on paper while quietly failing to make a new high for two weeks. Aroon catches that immediately, because the moment a stock stops setting new highs, Aroon Up starts falling. It is unsmoothed and it reacts on the day the extreme is set, which makes it one of the earlier signals available for a change in trend.
But the real reason to use Aroon is that it separates two situations that look identical to almost every other indicator: the quiet market and the violent one.
Both can show no net trend. The difference is what is happening underneath:
- Neither side making new extremes: Aroon Up low, Aroon Down low. The stock is genuinely going nowhere. It has not touched a new high or a new low in a while. This is a real range, and it is the environment premium-selling strategies want.
- Both sides making new extremes: Aroon Up high, Aroon Down high. The stock has recently set both a new high and a new low. That is not a quiet market, it is a violent two-sided one, and selling premium into it is how short strangles get run over.
Both of these produce an Aroon Oscillator near zero. Only Aroon Up and Aroon Down, read separately, tell them apart, and that is why Samurai exposes all three as filters you can combine.
How to use the Aroon indicator in Samurai
You can use the Aroon indicator to:
- Find stocks in a clean, established uptrend or downtrend.
- Catch a trend as it starts, using the "moved into" conditions.
- Spot a trend that is losing its grip: a stock that has stopped making new highs.
- Find genuine consolidation for range-bound and premium-selling strategies.
- Separate quiet ranges from choppy, two-sided ones before you sell premium into either.
- Add Aroon as a column and sort by the Oscillator to rank your trade opportunities (Pro tip: you can also save the scan).
The Filters
Aroon is available as three separate filters. You can use any one on its own, or add several to the same scan, in which case a stock has to satisfy all of them to appear in your results.
Aroon Oscillator
This is the main filter, and the only one with presets. It runs on the signed -100 to +100 Oscillator and has two views.
Basic view gives you ready-made conditions in one click, built around the ±50 band that marks a meaningful trend:
Basic view gives you ready-made conditions in one click, built around the ±50 band that marks a meaningful trend:
- Uptrend: the Oscillator is between 50 and 100.
- Downtrend: between -100 and -50.
- No clear trend: between -50 and 50.
- Moved into uptrend: has just crossed above 50.
- Moved into downtrend: has just crossed below -50.
- Moved out of uptrend: was above 50 and has just dropped back.
- Moved out of downtrend: was below -50 and has just climbed back.
And Any, for no Aroon condition.
Advanced view lets you set your own thresholds and play with periods outside/inside a range:
Advanced view lets you set your own thresholds and play with periods outside/inside a range:
- Length: the lookback, in days.
- From / To: the Oscillator range that defines your zone.
- Min. periods inside / outside range: how long the Oscillator has to have been in, or out of, that zone.
Aroon Up and Aroon Down
These two are simple sliders going from 0 to 100. They exist so you can describe the state of each side of the market independently, which the Oscillator alone cannot do.
Add both to a scan and you can express conditions the Oscillator has no way to represent:
- A clean uptrend: Aroon Up 70-100 and Aroon Down 0-30. The stock is making new highs and has not been near a new low.
- True consolidation: Aroon Up 0-30 and Aroon Down 0-30. Neither a new high nor a new low in some time.
- A two-sided, choppy market: Aroon Up 70-100 and Aroon Down 70-100. Both extremes are recent. Worth knowing about, usually worth avoiding.
Settings
Length: in days, default 14. This is the lookback window for both extremes, the period over which "the highest high" and "the lowest low" are measured. A shorter length makes the indicator quicker to react and quicker to reset; a longer one requires a more significant extreme before the readings change. It is set independently on each of the three filters.
From / To (Aroon Oscillator): the range that defines your zone, from -100 to +100. Because the scale is bounded, the outer edges are the literal -100 and +100 rather than open-ended. Some examples:
From / To (Aroon Oscillator): the range that defines your zone, from -100 to +100. Because the scale is bounded, the outer edges are the literal -100 and +100 rather than open-ended. Some examples:
- From 50, To 100: a clear uptrend.
- From -100, To -50: a clear downtrend.
- From -50, To 50: no clear trend either way.
- From 90, To 100: a very strong uptrend: recent high, distant low.
Min. periods inside / outside range: how long the Oscillator has to have been in (or out of) the range above, in days. Click the word to switch between inside and outside. The one setting gives you two different filters:
Breadth: set inside to 5, and you only see stocks that have held the condition for at least five days. A trend that has proven itself.
Breadth: set inside to 5, and you only see stocks that have held the condition for at least five days. A trend that has proven itself.
Cross: set outside to 1, and you only see stocks that were outside the zone yesterday and are inside it today. A trend that has just begun.
The Aroon Up and Aroon Down sliders: the minimum and maximum acceptable value, from 0 to 100. Aroon Up at 100 says the stock made a new high today; it says nothing about how big that high was.
Common use cases
- Aroon is in the uptrend zone: (1) Length 14 (default), (2) From: 50, To: 100, (3) Min. periods inside range: 0. (Or the "Uptrend" preset.)
- Aroon just crossed into uptrend: (1) Length 14, (2) From: 50, To: 100, (3) Min. periods outside range: 1 — it was outside the zone at least one day before entering it.
- Aroon crossed out of downtrend after a week there: (1) Length 14, (2) From: −50, To: 100, (3) Min. periods outside range: 5
- Aroon has been in uptrend for two weeks: (1) Length 14, (2) From: 50, To: 100, (3) Min. periods inside range: 10
- A very strong uptrend: (1) Length 14, (2) From: 90, To: 100 — the high is fresh and the low is old.
- A stock that has been going nowhere: add the Aroon Up filter set to 0-30 and the Aroon Down filter set to 0-30.
Read more
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