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Aroon Overview

The Aroon Oscillator measures the time elapsed since the most recent high and low within a lookback period, oscillating between -100 and +100. Values near +100 indicate a strong uptrend (recent new highs), while values near -100 indicate a strong downtrend (recent new lows).

Unlike momentum oscillators that measure price magnitude (RSI, ROC), Aroon focuses on timing — how recently highs and lows occurred — making it uniquely effective at detecting trend emergence before momentum confirms.

How Aroon Oscillator Works

Section titled “How Aroon Oscillator Works”

Core Concept

Section titled “Core Concept”
  1. Calculate Aroon Up: 100 × (n - bars since highest high) / n
  2. Calculate Aroon Down: 100 × (n - bars since lowest low) / n
  3. Compute Oscillator: Aroon Oscillator = Aroon Up - Aroon Down
  4. Interpret: +100 = new high just occurred, -100 = new low just occurred, 0 = balanced

Key Characteristics:

  • Time-Based = Measures when highs/lows occurred, not how large they were
  • Bounded Range = Oscillates between -100 and +100
  • Trend Emergence = Detects new trends early by tracking recency of extremes
  • No Volume Dependency = Works purely on price highs and lows

Visual Interpretation

Section titled “Visual Interpretation”

Aroon Behavior:

  • Values near +100 indicate strong uptrend (recent new highs)
  • Values near -100 indicate strong downtrend (recent new lows)
  • Crossing zero signals trend direction change
  • Hovering near zero suggests no clear trend

Trading Signals Available on Reversion

Section titled “Trading Signals Available on Reversion”

These are the signal names you select when configuring Aroon in the algorithm builder or via the MCP agent:

SignalTriggers WhenTypical Use
aroonUp_above_aroonDownAroon Up exceeds Aroon Down (oscillator > 0)Bullish trend — recent highs more dominant
aroonUp_below_aroonDownAroon Down exceeds Aroon Up (oscillator < 0)Bearish trend — recent lows more dominant
aroon_above_signalLineAroon oscillator crosses above its signal lineBullish momentum acceleration
aroon_below_signalLineAroon oscillator crosses below its signal lineBearish momentum acceleration

Display: Separate pane

Category: Momentum

Threshold range: -100 – +100

Key Characteristics

Section titled “Key Characteristics”

What Aroon Oscillator Does Well:

  • Early Trend Detection: Identifies new trends as soon as new highs/lows appear
  • Time-Based Unique Approach: Complements price-magnitude oscillators
  • Clear Trend Identification: Extreme values (+/-100) are unambiguous
  • No Lag at Extremes: New high/low immediately pushes indicator to 100