Elder Ray Index

The Elder Ray Index is a technical indicator developed by Dr. Alexander Elder that measures the strength of bulls and bears relative to an exponential moving average (EMA). It consists of two components: Bull Power (the difference between the session's high and the EMA) and Bear Power (the difference between the session's low and the EMA). Positive Bull Power indicates buyers are pushing price above the trend average; negative Bear Power means sellers are pressing price below it. Elder used these in combination with the EMA's direction: in an uptrend, traders look for brief dips in Bull Power as entry signals; in a downtrend, brief rallies in Bear Power signal short entry opportunities. The Elder Ray Index is typically used in conjunction with Elder's broader Triple Screen trading system.