Aroon Indicator Explained: How to Use It to Spot Early Trends
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TL;DR
The Aroon indicator is a technical indicator that helps you catch any trend change from the very beginning. Moreover, it shows whether a current price behavior is trending or ranging. Therefore, by using this indicator, a trader can refine their trading strategy to make it more profitable.
A trend is significant in financial trading because all trading strategies work well when they go along with the trend. Conversely, the price can create new swing levels in a ranging market with multiple false breakouts that often make trading difficult.
The Aroon indicator shows when a price changes its sentiment from trending to ranging. It determines how long the price holds its momentum after reaching new highs or lows. It is easily visible on the indicator window, with the Aroon Up and Aroon Down lines. Note that, like other indicators, there is a slight lag with the Aroon indicator.