Aroon Indicator strategy
The Aroon indicator, created by Tushar Chande, is unusual: instead of price or volatility, it measures time — how many periods have passed since the window's highest high and lowest low. Aroon Up rises toward 100 when a fresh high was set recently; Aroon Down does the same for a fresh low. When Up sits above Down, recent highs are newer than recent lows, which the rule reads as an uptrend. On this site it runs as the Aroon crossover, so it is worth testing honestly rather than taking the signal on faith.
How it works
- • Aroon Up — (window − periods since the highest high) ÷ window × 100 — near 100 just after a new high, decaying as the high ages.
- • Aroon Down — the same calculation for the lowest low — near 100 just after a fresh low.
- • Entry — go long while Aroon Up is above Aroon Down — the most recent extreme is a high, read as an uptrend in force.
- • The catch — it is a time-since-extreme gauge, not a confirmation of follow-through — the crossover can flip on a single new high that no trend follows.
On this site, Aroon Indicator is run as the Aroon. See honestly how that approach performed across every famous stock and coin — costs on, no look-ahead, measured against simply buying and holding, with the losses shown.
The honest caveat
Because Aroon reacts to the age of the last extreme, its crossover arrives after a move is already underway and can flip back the moment the opposite extreme is tagged — so in choppy, range-bound markets it whipsaws, and in smooth trends it often lags simply holding by waiting for the cross. Like most mechanical indicators, the Aroon crossover does not beat buy & hold on most assets; the honest value is seeing exactly where it did and where it didn't. Test it before you trust it.
Past performance is not a reliable indicator of future results. This is an educational, analytical tool — not investment advice, and not a recommendation to buy or sell anything. You make all decisions and execute on your own broker. This is an educational, analytical tool, not investment advice and not a recommendation to buy, sell or use any strategy. You make all decisions and execute on your own broker.