Percentage price oscillator
MACD expressed as a percent of the slow average, so stocks of different prices can be compared.
What it shows
PPO = (EMA 12 − EMA 26) ÷ EMA 26 × 100. It is MACD divided by the slow average. A value of 2 means the fast average is 2% above the slow one.
Because it is a percent, it can be compared between stocks and across years when price levels differ.
How we find it
The same code that draws it on your chart follows these steps, with the same result every time.
- Compute EMA(12) and EMA(26).
- PPO = (fast − slow) ÷ slow × 100.
- Signal line = EMA(9) of PPO.
- Plot under the price.
Starting values: Fast 12; Slow 26; Signal 9. These are proposed and will be tuned on real price data before launch.
How to read it
- The panel shows PPO in percent.
- The dashed line is zero.
- Above zero: the fast average is above the slow.
Status labels you may see
| Label | What it means |
|---|---|
| Above zero | PPO is above zero. |
| Below zero | PPO is below zero. |
| Near zero | PPO is between −0.5 and 0.5. |
What cancels it
Nothing cancels it.
What traders check next
- PPO compared with its own history.
- Signal line crosses.
- Price trend.
Limits
- Same lag as MACD.
- Depends on the averages chosen.
- Not a measure of future movement.
Try it in forecastviz
- Open any ticker and choose Momentum oscillators → Percentage price oscillator in the left menu.
- Switch between 6M, 1Y, 3Y to see how the picture changes.
- Compare with MACD and Rate of change on the same chart.
Questions
Why not just use MACD?
MACD is in price units and cannot be compared between stocks.
What is a high PPO?
It is relative to each stock's own history.
Related trends
Further reading
- Wilder, New Concepts in Technical Trading Systems
- Appel, Technical Analysis: Power Tools for Active Investors
- Murphy, Technical Analysis of the Financial Markets
- Kaufman, Trading Systems and Methods
Educational only. Not financial advice, and not a price forecast. Charts are drawn by code from past price data, which may be delayed.