One popular metric that technical analysts use to find new trends and measure the strength of those trends is the Aroon Oscillator.

The Aroon Oscillator was developed in the 1990’s by Tushar Chande. Typically, metrics called Aroon-Up and Aroon-Down are calculated based on a 25-day trading period. Aroon-Up is calculated using the following formula:

Aroon-Up=100*(25-(#of days since 25-day high))/25

Aroon down is calculated based on a similar formula.

The Aroon Oscillator is the difference between Aroon-Up and Aroon-Down and ranges from -100 to +100. A positive value represents an uptrend for the stock, and the higher the value, the stronger the trend. Therefore, a switch from positive to negative represents a new uptrend, and the closer the oscillator is to +100, the stronger the new trend should be.

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