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[Guru Dudette]

The Commodity Channel Index (CCI)

The CCI was developed by Donald Lambert, as a means of identifying cyclical turns in commodities. Typically, commodities (or stocks or bonds) move in cycles, with peaks and troughs coming at periodic intervals. You can chose the length of the cycle yourself to fit your needs. Lambert recommended using 33% of a complete cycle (peak to peak) as a time frame for the CCI. We typically use our proprietary version of the CCI to help identify price reversals, price extremes and occasionally the strength of the trend.