The Detrended Price Oscillator strips out longer-term trend to reveal short-term price cycles, helping commodity traders spot overbought and oversold swings more clearly.
In this guide to understanding the Detrended Price Oscillator, we’ll show you what this chart looks like, explain its components, and teach you how to interpret it for buy and sell signals.
What Is the Detrended Price Oscillator?
The Detrended Price Oscillator attempts to filter out trend to focus on the underlying cycles of price movement.
To accomplish this, the moving average (generally a 14-period) becomes a straight line and price variation above and below the moving average becomes the Price Oscillator.
What Does the Detrended Price Oscillator Look Like?
The chart of the S&P 500 E-mini Futures contract visually depicts the Detrended Price Oscillator:
How to Interpret the Detrended Price Oscillator
The Detrended Price Oscillator technical indicator attempts to show overbought or oversold levels and might also be used to potentially indicate buy and sell signals.
Bullish or Bearish?
When the Detrended Price Oscillator is above the zero line, it means that price is above its moving average, typically interpreted as a bullish sign.
Similarly, when the Detrended Price Oscillator is below the zero line, it means that price is below its moving average, considered to be a bearish sign.
Potential Buy Signal
There are two interpretations of buy signals:
- When Detrended Price Oscillator crosses above the zero line.
- When Detrended Price Oscillator is in a confirmed oversold area, as referenced by prior lows of the oscillator, and the Detrended Price Oscillator and price both break the downward resistance trendline.
Potential Sell Signal
There are two interpretations of sell signals:
- When Detrended Price Oscillator crosses below zero line.
- When Detrended Price Oscillator is in a confirmed overbought area, as referenced by prior highs of the oscillator, and the Detrended Price Oscillator and price both break the upward supporting trendline.
Summary
The Detrended Price Oscillator attempts to uncover hidden cycles of overbought and oversold conditions. For more information on Moving Averages and Moving Average crossover.
Regulated Brokers: Where Can I Trade Commodities?
Further Reading on Momentum Indicators
These momentum tools complement Detrended Price Oscillator: ADX Indicator, MACD Indicator, and Stochastic RSI.
Technical analysis is most widely used in CFD and forex trading. If you’re ready to apply these techniques, browse our vetted CFD brokers or forex brokers.
Update history
This page was revised 4 times between August 2020 and April 2026.
Added broker recommendation links and dynamic broker listing widget to Further Reading section.
Removed broker comparison table and consolidated Further Reading section to focus on momentum indicator resources.
Restructured page with improved navigation (added table of contents and summary section), refined grammar in three sentences, retitled interpretation section for clarity, and reorganized broker information under new dedicated section.
Restructured content by moving introductory paragraphs and adding new section headers for "Interpreting the Detrended Price Oscillator" and "Potential Buy Signal" to improve organization.
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