95 Choppiness Index (chop)

CHOP is an indicator designed to determine if the market is choppy (trading sideways) or not choppy (trading within a trend in either direction).

The closer the value is to 100, the higher the choppiness (sideways movement) levels. The closer the value is to 0, the stronger the market is trending (directional movement)

Calculated as:

100 * LOG10( SUM(ATR(1), n) / ( MaxHi(n) - MinLo(n) ) ) / LOG10(n)

With readings above the upper threshold, continued sideways movement maybe expected.

Choppiness Index

Figure 11.4: Choppiness Index

Readings below the lower threshold may indicate a continuing trend.

Choppiness Index

Figure 11.5: Choppiness Index

It can also indicate reversals.
Choppiness Index

Figure 11.6: Choppiness Index