DeMarker

DeM · module 22 of 33 · momentum

Demand for the instrument by comparing successive highs and lows, scaled 0–1.

DeMarker on a chart

EUR/USD · 1h · demo data

DeM
▲/▼ where the rule triggers

Compares new highs with new lows. Readings below 0.3 point to exhaustion of selling, above 0.7 of buying.

How to apply it

1. Add it. Start with 14 on 15m, levels 0.7/0.3 (Intraday).
2. Read the market first. Persistent readings above 0.7 indicate continued expansion of highs — strength rather than a top.
3. Adjust for ranges. Extremes at confirmed boundaries can time reversion entries.
4. Manage the trade. Place the stop at 1.5 × ATR and the target at 3.5 × ATR, and only act when the chart above shows the trigger.

How it is calculated

DeMax = High − Highprev when positive, else 0; DeMin = Lowprev − Low when positive, else 0; DeM = SMA(DeMax, n) ÷ (SMA(DeMax, n) + SMA(DeMin, n)).

Inputs

· Period (14)
· Levels (0.7 / 0.3)

Reading it correctly

In a trend

Persistent readings above 0.7 indicate continued expansion of highs — strength rather than a top.

In a range

Extremes at confirmed boundaries can time reversion entries.

Settings by style

Style	Suggested values
Intraday	14 on 15m, levels 0.7/0.3
Swing	14 on 4h

These are conventional starting points, not optimised values. Test any change on your own pair and timeframe before relying on it.

Worked example

SMA(DeMax,14) = 0.0018, SMA(DeMin,14) = 0.0007: DeM = 0.0018/0.0025 = 0.72. Highs are extending faster than lows, which is a strength reading above the conventional 0.7 line.

When it failed

On 15m EUR/GBP, DeM stayed above 0.7 for 40 candles in a steady uptrend. Each 'exhaustion' short lost, because expanding highs are precisely what an uptrend is.

Limitations

Uses only highs and lows, ignoring closes.
Saturates in trends like every bounded oscillator.
Less widely tested than RSI, with no clear advantage.

Works well alongside

· ADX / DMI
· Market structure

Redundant with

· RSI
· Stochastic
· Williams %R

Stacking these produces agreement by construction, which is not confirmation.

Practice exercise

On 4h AUD/USD, compare DeM(14) and RSI(14) extreme readings over 300 candles and record how often they disagree.

Check your understanding

1. DeMarker is built from:

· Closing prices only
✓ Successive highs and lows
· Volume
· Typical price

DeMax and DeMin compare each candle's high and low with the previous candle's.

2. DeM above 0.7 in a strong uptrend means:

· A top is confirmed
✓ Highs are consistently expanding — a strength reading
· Volatility is falling
· Volume is thin

Expanding highs are the definition of an uptrend, so a high reading is confirmation rather than a reversal signal.