Description

• PSY shows the ratio of no of rising period over the total period
• Its value lies between 0 and 100
• It reflects the buying power in relation to the selling power in the market

Interpretation

• It is a very simple indicator as it shows the ratio of rising period to total which indicates control of buyers and sellers
• If PSY value is above 50, means that buyers are in control of the price
• If PSY value is below 50, means sellers are in control of the price
• Divergence between price and PSY helps to give strong reversal indications

Default Parameters Used/Inputs

• Close Line
• Period

Returns/Output

PSY indicator value over a specific period

Formula

PSY = ∑ ( UP) / ∑ (Up + Down)
where, UP = Day when price close is above previous day’s close
Down = Day when price close is below previous day’s close