Indicator Learning Center
Simple Moving Average (SMA)
The average closing price over a set number of days.
How it is calculated
Add up the last N closing prices and divide by N. VEXA shows the 20-day and 50-day SMA.
How to interpret it
Price above a rising SMA suggests an uptrend; price below a falling SMA suggests a downtrend. When a shorter average crosses above a longer one, traders often read it as a bullish shift, and the reverse as bearish.
Limitations
It lags price, because it only reacts after a move has happened. In sideways markets price crosses the average repeatedly and gives false signals. Every day in the window has equal weight, so an old spike can distort it.
In VEXA
Scored. Price above SMA 20 adds 10 points and below subtracts 10. The same applies to SMA 50.
Exponential Moving Average (EMA)
A moving average that gives more weight to recent prices.
How it is calculated
Each day's EMA = today's price × k + yesterday's EMA × (1 − k), where k = 2 ÷ (N + 1). VEXA uses 12 and 26 days.
How to interpret it
Because it reacts faster than an SMA, it turns sooner. EMA 12 above EMA 26 indicates short-term strength relative to the longer trend.
Limitations
Faster reaction also means more false alarms. Like all moving averages it describes the past and does not predict.
In VEXA
Scored. EMA 12 above EMA 26 adds 8 points; below subtracts 8. These two EMAs also form the MACD.
MACD (Moving Average Convergence Divergence)
Measures momentum by comparing two EMAs.
How it is calculated
MACD line = EMA 12 − EMA 26. The signal line is a 9-day EMA of the MACD line. The histogram is MACD line − signal line.
How to interpret it
MACD above its signal line (positive histogram) shows upward momentum; below shows downward momentum. A histogram that is growing means momentum is strengthening. Crossovers of the signal line are the classic trigger. Divergence, where price makes a new high but MACD does not, can warn of weakening.
Limitations
It lags, and in choppy markets it crosses back and forth. Its values depend on the share price, so you cannot compare MACD levels between different stocks.
In VEXA
Scored on the histogram: positive and rising +10, positive but shrinking +5, negative and falling −10, negative but improving −5.
Average Directional Index (ADX)
Measures how strong a trend is, not which way it points.
How it is calculated
Built from the smoothed directional movement lines +DI and −DI over 14 days. ADX is a smoothed average of the gap between them.
How to interpret it
Above 25 usually means a strong trend; below 20 means a weak or absent trend. Compare +DI and −DI for direction: +DI above −DI is an uptrend.
Limitations
ADX rises after a trend has already begun, so it confirms rather than anticipates. A high ADX can occur in a strong downtrend too.
In VEXA
Scored only when ADX is above 25: +10 if +DI is above −DI, −10 otherwise. Below 20 only adds a note that signals are less reliable.
Ichimoku Cloud
A set of lines that map trend, support and resistance at once.
How it is calculated
Tenkan = midpoint of the 9-day high and low. Kijun = midpoint of the 26-day high and low. Senkou Span A = average of Tenkan and Kijun, plotted 26 days ahead. Span B = midpoint of the 52-day range, plotted 26 days ahead. The area between the spans is the cloud.
How to interpret it
Price above the cloud is bullish, below is bearish, inside the cloud means indecision. A thick cloud can act as stronger support or resistance.
Limitations
It needs about 78 days of data and many lines can confuse beginners. The 9/26/52 settings were designed for a Japanese six-day trading week and are used here unchanged. VEXA does not draw the lagging span.
In VEXA
Scored. Price above the cloud adds 10 points; below subtracts 10; inside adds nothing.
Parabolic SAR
Trailing dots that follow the trend and flip when it reverses.
How it is calculated
A stop-and-reverse level that moves toward price each day by an acceleration factor (starts at 0.02, rises by 0.02 up to 0.2) times the distance to the extreme price of the current trend.
How to interpret it
Dots below price mean an uptrend; dots above mean a downtrend. A flip suggests the trend may be reversing and can be used as a trailing stop.
Limitations
In sideways markets it flips constantly and gives many false reversals. It works best in clear trends.
In VEXA
Scored. Bullish adds 6 points, bearish subtracts 6.
Relative Strength Index (RSI)
A 0–100 gauge of how fast and how far price has recently moved.
How it is calculated
RSI = 100 − 100 ÷ (1 + RS), where RS is the average gain divided by the average loss over 14 days (Wilder smoothing).
How to interpret it
Above 70 is traditionally 'overbought' and below 30 'oversold', which can precede a pause or a bounce. Readings between 40 and 60 are neutral.
Limitations
In strong trends RSI can stay above 70 (or below 30) for weeks, so 'overbought' does not mean 'about to fall'. It is a momentum measure, not a timing tool.
In VEXA
Scored. Below 30 adds 12 points; above 70 subtracts 12; in between adds 3.
Stochastic Oscillator
Shows where today's close sits within the recent high-low range.
How it is calculated
%K = (close − lowest low of 14 days) ÷ (highest high − lowest low) × 100. %D is the 3-day average of %K.
How to interpret it
Above 80 is overbought and below 20 oversold. Closes near the top of the range in an uptrend show strength.
Limitations
Very noisy on its own and gives frequent false signals in trends. Best used alongside a trend indicator.
In VEXA
Scored using %K: below 20 adds 6, above 80 subtracts 6.
Commodity Channel Index (CCI)
Measures how far the typical price is from its average.
How it is calculated
CCI = (typical price − 20-day average of typical price) ÷ (0.015 × mean deviation). Typical price = (high + low + close) ÷ 3.
How to interpret it
Above +100 suggests a strong move or overbought conditions; below −100 suggests an oversold or strong downward move. Most readings fall between −100 and +100.
Limitations
It is unbounded, so extremes can persist. Different charting platforms use slightly different periods.
In VEXA
Scored. Below −100 adds 5 points; above +100 subtracts 5.
Rate of Change (ROC)
The percentage price change over a set number of days.
How it is calculated
ROC = (today's close ÷ close 12 days ago − 1) × 100.
How to interpret it
Above zero means price is higher than 12 days ago (positive momentum); below zero means lower. Larger values mean faster moves.
Limitations
One old price point drives it, so it can jump when a large day drops out of the window. It says nothing about why price moved.
In VEXA
Scored. Positive adds 5 points; negative subtracts 5.
7-day and 30-day price change
Simple recent performance over about a week and about a month.
How it is calculated
Percentage change between today's close and the close roughly 7 and 30 trading days earlier.
How to interpret it
A rising stock tends to keep a little momentum in the short run, while a sharp rise can also mean it is stretched.
Limitations
Short windows are noisy and heavily affected by single news events.
In VEXA
Scored. 7-day change above +3% adds 5, below −3% subtracts 5. 30-day change above +5% adds 5, below −5% subtracts 5.
On-Balance Volume (OBV)
A running total of volume that adds on up days and subtracts on down days.
How it is calculated
If today closes higher, add today's volume to the total; if lower, subtract it; if unchanged, no change.
How to interpret it
Rising OBV while price rises confirms the move. OBV falling while price rises (a divergence) can be an early warning.
Limitations
It ignores how large the price move was and treats a 0.1% gain like a 5% gain. The absolute number has no meaning; only its direction does.
In VEXA
Scored. If OBV is higher than 20 trading days ago, +6; otherwise −6.
Accumulation/Distribution Line
Weighs volume by where the price closed within the day's range.
How it is calculated
Money-flow multiplier = ((close − low) − (high − close)) ÷ (high − low). Multiply by volume and add to a running total.
How to interpret it
A rising line suggests buyers are in control (closes near highs on volume); a falling line suggests selling pressure.
Limitations
Ignores overnight gaps. Daily bars can hide intraday reversals.
In VEXA
Scored. Rising over 20 days adds 4; falling subtracts 4.
Money Flow Index (MFI)
A volume-weighted version of RSI.
How it is calculated
Like RSI, but uses typical price × volume (raw money flow) over 14 days to compare positive and negative flows.
How to interpret it
Above 80 suggests overbought and below 20 oversold, with the added information that volume supports the move.
Limitations
Has the same limits as RSI: extremes can last in a strong trend. Needs reliable volume data.
In VEXA
Scored. Below 20 adds 6; above 80 subtracts 6.
VWAP (volume-weighted average price)
The average price weighted by how much traded at each price.
How it is calculated
True VWAP uses intraday trades and resets each day. VEXA uses daily bars, so it shows a 20-day rolling VWAP = Σ(typical price × volume) ÷ Σ(volume).
How to interpret it
Price above VWAP means buyers have paid up recently; below means sellers have been in control. Institutions often use it as a fair-value reference.
Limitations
The 20-day daily version is not the same as the intraday VWAP day traders use. It lags and says little about the next move.
In VEXA
Scored. Price above the 20-day VWAP adds 4; below subtracts 4.
Volume ratio
Compares the last 5 days of trading volume with the 60-day average.
How it is calculated
Average volume of the last 5 days ÷ average volume of the last 60 days.
How to interpret it
Above 1.5 means unusually heavy trading. Heavy volume on a rising day suggests conviction; on a falling day, selling pressure.
Limitations
Earnings releases and index events create volume spikes that are not trend signals.
In VEXA
Scored when above 1.5: +6 if the latest day was up, −6 if down.
Bollinger Bands
A channel around a 20-day average, two standard deviations wide.
How it is calculated
Middle band = 20-day SMA. Upper and lower bands = middle ± 2 × the 20-day standard deviation of closing prices. Band width % = (upper − lower) ÷ middle.
How to interpret it
Bands widen when volatility rises and narrow in quiet markets. A very narrow band (a 'squeeze') often comes before a bigger move, but does not say which direction. Touching a band is not by itself a buy or sell signal.
Limitations
In strong trends price can ride along a band for a long time. The 2-standard-deviation setting is a convention, not a law.
In VEXA
Scored. Close below the lower band adds 6; above the upper band subtracts 6. A band width under 6% is flagged as a squeeze.
Average True Range (ATR)
The typical size of a day's price swing.
How it is calculated
True range = the largest of (high − low), |high − previous close| and |low − previous close|. ATR is the 14-day Wilder average.
How to interpret it
A higher ATR means bigger daily swings. Traders use multiples of ATR to size stops and positions. ATR % (ATR ÷ price) lets you compare different stocks.
Limitations
It measures size only and gives no direction. Gaps can inflate it temporarily.
In VEXA
Displayed only. It is not part of the score.
VIX (CBOE Volatility Index)
The market's expected volatility for the S&P 500 over the next 30 days.
How it is calculated
Calculated from S&P 500 option prices. VEXA reads the latest value of the ^VIX index.
How to interpret it
Roughly, below 15 is a calm market and above 30 signals high fear. It tends to rise when stocks fall sharply.
Limitations
It describes the whole market, not any single stock, and being high does not tell you when fear will end.
In VEXA
Scored on the live analysis only: above 30 subtracts 5; below 15 adds 3. It is not available in historical tests.
Fibonacci Retracement
Horizontal levels between a recent high and low where pullbacks sometimes pause.
How it is calculated
Using the highest high and lowest low of the last 120 trading days, VEXA marks levels 23.6%, 38.2%, 50% and 61.8% of the way down from the high.
How to interpret it
Traders watch these levels as possible support in a pullback after a rise. Shallower pullbacks (23.6–38.2%) suggest a stronger trend.
Limitations
Which high and low to use is subjective, and many levels means price will often seem to react to one of them. Evidence that the levels have predictive value is weak. 50% is not a true Fibonacci ratio.
In VEXA
Displayed only. Not part of the score.
Pivot Points
Support and resistance levels calculated from the latest bar.
How it is calculated
Pivot = (high + low + close) ÷ 3. R1 = 2 × pivot − low, S1 = 2 × pivot − high, R2 = pivot + (high − low), S2 = pivot − (high − low).
How to interpret it
Price above the pivot is mildly bullish and below is mildly bearish. R1/R2 and S1/S2 act as possible turning points.
Limitations
Mostly an intraday tool. VEXA calculates them from the latest daily bar, so treat them as a rough reference.
In VEXA
Displayed only. Not part of the score.
52-week high and low
The highest and lowest prices of the past year.
How it is calculated
Maximum of the daily highs and minimum of the daily lows over the last 252 trading days.
How to interpret it
Stocks near their 52-week high are showing strength; stocks far below may be depressed or in trouble.
Limitations
A stock can be close to its high just before reversing, or far below its high for good reason.
In VEXA
Scored. Within 5% of the high adds 3 points; more than 30% below adds 4 (as a possible rebound).
P/E ratio (price-to-earnings)
How many dollars investors pay for each dollar of yearly profit.
How it is calculated
Share price ÷ earnings per share over the last 12 months (trailing). Forward P/E uses analysts' estimated next-12-month earnings.
How to interpret it
A low P/E can mean a bargain or a company in trouble; a high P/E means investors expect strong growth. Always compare with similar companies and the company's own history.
Limitations
Meaningless when earnings are negative. Differs a lot between sectors. One-time items distort earnings.
In VEXA
Scored on trailing P/E in the full analysis: below 15 adds 10; above 50 subtracts 5. Forward P/E is displayed only.
Revenue and earnings growth
How fast sales and profits are growing compared with a year earlier.
How it is calculated
The year-over-year percentage change reported by the data provider (Yahoo Finance).
How to interpret it
Growing revenue and earnings support a rising share price over time. Growth faster than the sector can justify a higher P/E.
Limitations
One quarter can be unusual. Growth from a tiny base looks large. Figures can be revised.
In VEXA
Scored. Growth above 10% adds 10 points each for revenue and earnings; negative growth subtracts 10 each.
Return on Equity (ROE)
How much profit a company makes from shareholders' money.
How it is calculated
Net income ÷ shareholders' equity.
How to interpret it
Consistently above about 15% is considered strong. Compare within the same industry.
Limitations
Heavy debt or large buybacks can inflate ROE without improving the business. Negative equity makes it meaningless.
In VEXA
Scored. Above 15% adds 8; below 0% subtracts 8.
Free Cash Flow (FCF)
Cash left over after running the business and investing in equipment.
How it is calculated
Operating cash flow − capital expenditures.
How to interpret it
Positive and growing FCF funds dividends, buybacks and growth without borrowing. Negative FCF means the business is consuming cash.
Limitations
Young growth companies often have negative FCF by choice. One large capital project can swing it.
In VEXA
Scored. Positive adds 6; negative subtracts 6.
Debt-to-Equity
How much the company borrows compared with shareholders' equity.
How it is calculated
Total debt ÷ shareholders' equity. Yahoo reports it as a percentage; VEXA displays it as a ratio (divided by 100).
How to interpret it
Higher ratios mean more financial risk, especially if profits fall or interest rates rise.
Limitations
Acceptable levels vary hugely by industry. Banks and utilities normally carry far more debt than software companies.
In VEXA
Scored. Above 2.0 subtracts 6; below 0.5 adds 4.
Beta
How much a stock tends to move relative to the overall market.
How it is calculated
Statistical sensitivity of the stock's returns to the market's returns (from Yahoo Finance).
How to interpret it
A beta of 1 means it moves with the market; above 1 amplifies moves; below 1 is calmer.
Limitations
Based on the past, so it changes. It captures market-related risk only, not company-specific risk.
In VEXA
A beta above 2 or below 0.5 appears as a note in the factor list. It does not change the score.
Analyst rating and price target
The consensus recommendation and average price target of Wall Street analysts.
How it is calculated
Collected by Yahoo Finance from analyst reports. VEXA shows the recommendation key and the mean target price.
How to interpret it
Useful as one more opinion and for seeing how analysts' views differ from the price.
Limitations
Analysts are slow to downgrade, can have business ties to the companies, and targets are often wrong. Treat as an opinion, not a forecast.
In VEXA
Scored on the rating: Buy or Strong Buy adds 20 points; Sell, Underperform or Strong Sell subtracts 20. The target is displayed only.
Market capitalization
The total market value of a company's shares.
How it is calculated
Share price × number of shares outstanding.
How to interpret it
Larger companies are generally more liquid and more stable; smaller ones are riskier but can grow faster.
Limitations
Says nothing about whether the stock is cheap or expensive.
In VEXA
Displayed and used in the Stock Screener filters. Not part of the score.
News sentiment (keyword-based)
A rough positive/negative reading of headlines based on word lists.
How it is calculated
VEXA counts words from a positive list (such as beat, surge, upgrade) and a negative list (such as miss, lawsuit, downgrade) in the headline and any summary the publisher provides. Score = (positive − negative) ÷ (positive + negative) × 100. Above +20 is labeled Positive, below −20 Negative, otherwise Mixed or Neutral.
How to interpret it
Use it as a quick hint about the tone of coverage, never as a verdict on a story.
Limitations
It cannot understand context, negation ('did not beat'), sarcasm or which company the word refers to. It reads headlines, not whole articles. Word lists are short and hand-chosen.
In VEXA
Counts for 20% of the combined prediction in the full analysis. Not used in Alpha Finder.
How the VEXA prediction is built
How the technical, fundamental and news scores become an up/down percentage.
How it is calculated
Combined = 50% technical score + 30% fundamental score + 20% news score. This is limited to ±80, then Up % = 50 + 0.4 × combined, so it can only range from about 18% to 82%. Up % of 65 or more is labeled Bullish, 35 or less Bearish, otherwise Neutral. The VEXA Score (1 to 100) is the same limited score rescaled: 50 + combined × 0.625, so 50 is neutral, 100 is the strongest and 1 the weakest.
How to interpret it
It is a rules-based summary of many signals pointing the same way, not a statistical probability.
Limitations
The weights and point values were chosen by hand and have not been optimized or proven to predict returns. Use the Backtesting page to see how the technical part has behaved historically.
In VEXA
This is the score shown on AI Predictions and Stock Analysis. It is a general stock score, not a forecast of beating the S&P 500.
Alpha Finder ranking
A relative-strength ranking built to look for stocks that may beat the S&P 500.
How it is calculated
On each date every eligible stock gets a percentile rank on six price-based factors: 12-1 month momentum, 6-month momentum, 3-month strength versus the S&P 500, trend versus the 200-day average, low volatility and closeness to the 52-week high. The ranks are averaged and re-ranked into a 1–100 score.
How to interpret it
A higher rank means a stock has historically sat in groups that, on average, beat the S&P 500 over the following months. The Alpha Finder page shows the walk-forward test behind each bucket.
Limitations
It is based on prices only. Tests use today's index members, which creates survivorship bias and probably overstates results. Estimates are historical averages for a bucket, not forecasts for a stock. Factors like momentum can fail for long stretches.
In VEXA
Used only on the Alpha Finder page and the Alpha Finder backtest. It is separate from the VEXA prediction score.