Percentage values showing the current difference between the number of traders, which have opened Long and Short positions. At that, already closed trades don’t affect the indicator’s value.
This indicator shows the sentiment of individual traders for a certain currency pair. According to the fact that “the crowd is usually wrong” we should open our trades in the direction opposite to the crowd’s direction.
Basic Ratio Strategy
We should open a long position when more than 60% of traders are short, and as you probably guessed, we should open a short position when more than 60% of traders are long. When the ratio is close to the value of 50%, we should not trade.
We can also analyze the ratio from different brokers to diversify risks. We should look for the majority of brokers showing unidirectional signals.
A good signal to open a short trade is on the picture above.
1.0.2 (December 29, 2021) - [Important] Update to new API version 1.0.1 (August 18, 2020) - Security and stability improvements 1.0.0 (August 13, 2020) - Released