The Herrick Payoff Index is designed to show the amount of money flowing into or out of a futures contract. The Index uses open interest during. The Herrick Payoff Index (HPI) was authored by John Herrick. The HPI is used to analyze futures and commodities. One input parameter called value of one. What is Herrick Payoff Index? This is a commodity trading tool, useful for the early spotting of changes in price trend direction.

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The trendlines identify a bearish divergence where prices were making new highs while the Payoff Index was failing to make new highs.

The standard for the smoothing factor is ten, which relates to a period moving average. Bear and Bull volume indicator volume volumes Wyckoff. The multiplying factor is part of a smoothing mechanism. The first daily divergence appeared in June, and the HPI then formed a series of lower highs line 1.

herrick payoff index – Indices – MQL4 and MetaTrader 4 – MQL4 programming forum

To help us continually offer you the best experience on ProRealCode, we use cookies. The Herrick Payoff Index requires two inputs, a smoothing factor known as the “multiplying factor” and the “value of a one cent move.

As is typical with divergences, prices corrected to confirm the indicator. What is Ladder Bottom: Yes, precious metal futures. What is Abandoned Baby Bottom: As noted on the weekly chart, the correction was sharp, but quite brief, which is typical of bull market corrections. The HPI did confirm the new highs as indicated by line C and, therefore, when the HPI dropped below its WMA in mid-January point 4 the earlier weekly confirmation of the highs suggested that inex was only a correction within an uptrend.


What is Bullish Rising Three Method: So much for the easy calls. In the second part of this article I will look at some further examples of the HPI. What is Dark Cloud Cover: By September 22, the HPI had made new highs for the year and was leading prices higher. Past performance is not indicative of herric results. Volume Accumulation Percentage Indicator volume. However it is here where the divergences between the HPI and silver futures begin.

Bullish Reversal, Bearish Reversal?

Herrick Payoff Index

What is Bearish Falling Three Method: Taking even a longer-term view of this market is difficult as the dramatic increase in the open interest makes the scaling difficult. The daily chart of June crude oil shows that the HPI moved back above the zero line, and its WMA on January 31,line A two weeks before the downtrend, was overcome. Please enable JavaScript to view this page content properly.

Register Login connect with Facebook. Divergences in the Journal are very important.

The average Joe kicked the experts’ backsides! When the Index is below zero, it shows that money is flowing out of the futures contract which is bearish. Free Trial Reader Infex.

Trading Techniques – The Herrick Payoff Index

Nicolas 10 months heerrick. This is the period on the weekly chart that I noted previously where the weekly formed a slight negative divergence. Prices then moved sideways for over two weeks and then turned higher as the HPI resistance was overcome point 2.


The Herrick Payoff Index is an excellent technical analysis tool using volume and open interest to confirm price movement and warn of potential reversals. Bretty86 Great work Nicolas!

Interpretation When the Herrick Payoff Index is above zero, it shows that money is flowing into the futures contract which is bullish. In this case, using the Herrick Payoff Index effectively would involve looking for divergences between the spiky advances in gold and the HPI indicator.

What is technical analysis? With stocks up significantly on the day the Nasdaq was up more than 3. Verify your Moneycontrol account.

Herrick Payoff Index

The series of divergences suggested that tighter trailing stops might be a good idea. Both the HPI and platinum futures trended upward from the beginning of February to the beginning of March. The interpretation of the Herrick Payoff Index involves looking for divergences between the Index and prices. Como puedo herfick algunos indicadores de esta pagina?

You will note that the daily HPI shows the same surge in late September as apparently inxex accumulation was taking place. The HPI can be analyzed on many levels, and the most simple is to determine whether it is above or below the zero line.