The AroonUp function is part of the Aroon indicator used in financial technical analysis to measure the strength and momentum of a trend by identifying when highs occur within a given time frame. The Aroon indicator consists of two lines: Aroon Up and Aroon Down. The Aroon Up value specifically measures the number of periods since the highest price was reached, helping to determine the strength of an uptrend.

Syntax:

AroonUp[N]

Where N represents the number of periods over which the highs are evaluated.

Example:

N = 20
myAroonUp = AroonUp[N]
IF(myAroonUp > 50) THEN
    SIGNAL = 1
ELSE
    SIGNAL = -1
ENDIF
RETURN SIGNAL

In this example, the Aroon Up value is calculated over 20 periods. If the Aroon Up value is greater than 50, it sets a signal variable to 1, indicating a strong uptrend. Otherwise, it sets the signal to -1, suggesting the uptrend is weak or absent.

Calculation:

The Aroon Up value is calculated by identifying the number of periods since the highest price within the last N periods. The value is then expressed as a percentage of the total periods:

• If a new high is reached today, Aroon Up equals 100.
• If the highest price was N periods ago, Aroon Up equals 0.

Interpretation:

The Aroon Up indicator is useful for identifying when an uptrend is gaining or losing strength. Higher values of Aroon Up (typically above 70) suggest a strong uptrend, while lower values indicate a weakening trend. The relationship between Aroon Up and Aroon Down can also signal potential trend reversals or confirmations.

This function does not provide trading or financial advice but serves as a tool for analyzing market trends.