Investors have placed HMS Holdings Corp (HMSY) shares on watch as the Aroon Up indicator has moved above 70, indicating that there is strong upward momentum building for the shares.
If Aroon-Up crosses above Aroon-Down to the upside, it signals the beginning of a potential uptrend. When the Aroon-Up line hits 100, price action is making new highs. If Aroon-Up then remains stable between 70 – 100, while Aroon-Down remains between 0 – 30, it signals confirmation of an uptrend.
The Aroon indicator was developed by Tushar Chande in 1995. Aroon is used to measure the presence and strength of trends. According to Chande, whenever the components of the Aroon indicator are in close proximity, this is a sign of market consolidation. Aroon Up measures the uptrend, and Aroon Down measures the downtrend. When Aroon Up or Aroon Down values drop below 50, this indicates loss of upward and downside momentum respectively. Values above 70 are signs of a strong trend for either component, while values that are less than 30 show that primary trend is weakening and opposing trend is picking up.
Traders also may be narrowing in on the ATR or Average True Range indicator when reviewing technicals. At the time of writing, HMS Holdings Corp (HMSY) has a 14-day ATR of 0.53. The average true range indicator was created by J. Welles Wilder in order to measure volatility. The ATR may assist traders with figuring out the strength of a breakout or reversal in price. It is important to note that the ATR was not designed to determine price direction or to predict future prices.
Some investors may find the Williams Percent Range or Williams %R as a helpful technical indicator. Presently, HMS Holdings Corp (HMSY)’s Williams Percent Range or 14 day Williams %R is resting at -43.78. Values can range from 0 to -100. A reading between -80 to -100 may be typically viewed as strong oversold territory. A value between 0 to -20 would represent a strong overbought condition. As a momentum indicator, the Williams R% may be used with other technicals to help define a specific trend.
Investors may use multiple technical indicators to help spot trends and buy/sell signals. Presently, HMS Holdings Corp (HMSY) has a 14-day Commodity Channel Index (CCI) of 36.07. The CCI was developed by Donald Lambert. The assumption behind the indicator is that investment instruments move in cycles with highs and lows coming at certain periodic intervals. The original guidelines focused on creating buy/sell signals when the reading moved above +100 or below -100. Traders may also use the reading to identify overbought/oversold conditions.
The Average Directional Index or ADX is a popular technical indicator designed to help measure trend strength. Many traders will use the ADX in combination with other indicators in order to help formulate trading strategies. Presently, the 14-day ADX for HMS Holdings Corp (HMSY) is 24.43. In general, an ADX value from 0-25 would indicate an absent or weak trend. A value of 25-50 would indicate a strong trend. A value of 50-75 would signal a very strong trend, and a value of 75-100 would indicate an extremely strong trend. The ADX alone was designed to measure trend strength. When combined with the Plus Directional Indicator (+DI) and Minus Directional Indicator (-DI), it can help decipher the trend direction as well.
Taking a peek at some Moving Averages, the 200-day is at 18.93, the 50-day is 18.93, and the 7-day is sitting at 19.83. The moving average is a popular tool among technical stock analysts. Moving averages are considered to be lagging indicators that simply take the average price of a stock over a specific period of time. Moving averages can be very useful for identifying peaks and troughs. They may also be used to help the trader figure out proper support and resistance levels for the stock.