The coppock Formula was made by Edwin Sedgwick coppock and used to recognize major bottoms in the stock markets. After every extreme bottom combined with several other indicators you get a strong signal of change of direction, this is done by looking at the curves to recognize if there is a sell signal or a buy signal.
Uses of the coppock guide in trading with EA’s.
Most EA’s strategies are based on recognizing trend changes, volatile markets and when no to make trades (drawdowns), the coppock guide can be used together with the Bollinger bands indicator to create a strong signal of major bottoms in the market, which allows the EA’ to make the right buy or sell in the right time and profit from it.
Coppock Curve = 10-period WMA of 14-period RoC + 11-perod RoC
WMA = Weighted moving average
RoC = Rate-of-Change
Screenshot of the coppock curve as seen in charts
taken from stockcharts.com
Video that desmonstrate the uses of coppock curve