Williams %R
An overbought/oversold momentum oscillator similar to Stochastic.
Williams %R is a momentum oscillator that ranges from -100 to 0. It shows where the current close is relative to the highest high over the lookback period. Values near 0 indicate overbought conditions. Values near -100 indicate oversold conditions.
Why It Matters
Williams %R reacts quickly to price changes, making it useful for timing entries in fast-moving markets. It's functionally similar to the Stochastic but uses a different scale, which some traders find more intuitive.
Settings Explained
Direction — Bullish, bearish, or both.
Period — The lookback period. Standard is 14.
Overbought Level — Standard is -20. Values above this suggest the market may be due for a pullback.
Oversold Level — Standard is -80. Values below this suggest the market may be due for a bounce.
Look Back Mode — How far back to calculate.
Example Use Case
You use Williams %R with a Threshold block that triggers when the value drops below -80 (oversold). Combined with a bullish trend filter (like price above a 200 SMA), this creates a 'buy the dip in an uptrend' strategy.
Williams %R and the Stochastic Oscillator often produce similar signals. You don't need both in the same strategy — pick whichever you find more intuitive.