📈 Indicators·intermediate

Williams %R

Also called: williams percent r, %r

A momentum oscillator similar to stochastics that measures overbought and oversold conditions on an inverted scale (-100 to 0).

Williams %R is a momentum indicator created by Larry Williams. It scales between -100 and 0. Readings above -20 are overbought. Readings below -80 are oversold. The math is essentially an inverted version of the stochastic oscillator — the two indicators give very similar signals. The main strength of Williams %R is its responsiveness. It reacts faster to price changes than RSI or stochastics, which makes it useful for short-term trading. The downside is that it whipsaws more in choppy markets. Like all overbought/oversold oscillators, %R works best in ranging markets and fails in strong trends. Always confirm signals with price action and structure before trading them.

Real trade example

GBP/USD scalpers used Williams %R during the 2024 summer chop to fade overbought (-10) and oversold (-90) extremes in the 1.27-1.29 range. The setup paid out reliably for two months until the range broke.

Related terms

Stochastic Oscillator

intermediate

A momentum indicator that compares the current close to its recent high-low range — used to spot overbought and oversold conditions.

RSI (Relative Strength Index)

intermediate

A momentum indicator from 0-100 that flags overbought (>70) and oversold (<30) conditions — and, more importantly, divergences.

CCI (Commodity Channel Index)

intermediate

A momentum oscillator that measures how far price has deviated from its average — used to identify overbought and oversold extremes.

MACD

intermediate

A momentum indicator that compares two moving averages to show trend direction, strength, and potential reversals.

Bollinger Bands

intermediate

A volatility indicator with three lines — a moving average and two bands set at standard deviations above and below it.

ATR (Average True Range)

intermediate

An indicator that measures average price volatility over a set period — used to size stops and position sizes.

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