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Williams %R, inverted

Indicator · Intermediate · Daily bars · Williams %R was created by Larry Williams

Use a %R extreme as a timer — buy the oversold dip in an uptrend, sell the overbought rip in a downtrend.

%R tells you when a dip is ending — not whether the trend is up. Use it to time entries inside a move you already believe in.

How to trade it (bullish)

  1. Setup: In an uptrend, wait for Williams %R to drop below -80 (deep oversold).
  2. Entry: Buy when %R turns back up through -80 — confirmation the pullback is ending.
  3. Stop and exit: Stop below the pullback low. Exit at target, trail, or when %R reaches -20.

How to trade it (bearish)

  1. Setup: In a downtrend, wait for Williams %R to rise above -20 (deep overbought).
  2. Entry: Sell when %R turns back down through -20 — confirmation the rally is ending.
  3. Stop and exit: Stop above the rally high. Exit at target, trail, or when %R reaches -80.

Why it works

In an uptrend, a deep oversold reading is a temporary pullback, not a top. Buying that dip gets you a better price and a tight stop. %R is a timer, not an edge on its own — it needs a bullish context.

Watch out for

In a downtrend, oversold gets more oversold — never run without a trend/regime gate. The turn-up confirmation is mandatory.

Pairs well with

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Popular markets for this pattern: Silver, Coffee, GBP/USD, USD/JPY, USD/CAD, QQQ