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Reversion Docs

PO Overview

The Price Oscillator (PO/PPO) is the percentage version of MACD — it measures the percentage difference between two EMAs rather than the absolute difference. This normalization allows comparing momentum across different-priced assets.

PO solves MACD’s main limitation: because MACD uses absolute price difference, a MACD value of 2.0 means different things for a $10 stock vs a $50,000 crypto. PO normalizes this to percentages.

How Price Oscillator Works

Section titled “How Price Oscillator Works”

Core Concept

Section titled “Core Concept”
  1. Calculate PO value from the input price/volume data
  2. Apply smoothing if applicable
  3. Compare to threshold or signal line for signal generation
  4. Interpret: Signals indicate momentum direction or extremes

Key Characteristics:

  • Momentum Indicator = Measures momentum direction and strength
  • Signal Line Available = Yes
  • Bounded = No (unbounded)

Visual Interpretation

Section titled “Visual Interpretation”

PO Behavior:

  • Bullish momentum — percentage-based
  • Bearish momentum — percentage-based
  • Signal line crossovers provide timing signals

Trading Signals Available on Reversion

Section titled “Trading Signals Available on Reversion”

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

SignalTriggers WhenTypical Use
poi_positivePO is positive (fast EMA > slow EMA)Bullish momentum — percentage-based
poi_negativePO is negative (fast EMA < slow EMA)Bearish momentum — percentage-based
poi_above_signalLinePO crosses above signal lineMomentum accelerating
poi_below_signalLinePO crosses below signal lineMomentum decelerating

Display: Separate pane

Category: Momentum

Threshold range: Unbounded (percentage-based, centered on zero)

Key Characteristics

Section titled “Key Characteristics”

What Price Oscillator Does Well:

  • Clear Directional Signals
  • Combines well with trend filters
  • Signal line crossovers signals for entry timing