Quick Summary
==============
The Relative Rate of Change (RRoC) is an expanded version of the classic Rate of Change ( RoC ) indicator  we apply couple of changes to bring additional insights and signals from that classic Technical Analysis concept  which can help us better visualize the "relative speed of change" of a stock (or whatever we trade), and can work specifically as a "breakout finder" .. please read on if this can be valuable to your trading.
First, a quick review of what is the classic Rate of Change ( RoC )  The below part is from Investopedia definition of RoC

www.investopedia.com...s/r/rateofchange.asp
What is Rate of Change ( ROC )
The rate of change ( ROC ) is the speed at which a variable changes over a specific period of time.
ROC is often used when speaking about momentum, and it can generally be expressed as a ratio between a change in one variable relative to a corresponding change in another; graphically, the rate of change is represented by the slope of a line.
Understanding Rate of Change ( ROC )
Rate of change is used to mathematically describe the percentage change in value over a defined period of time, and it represents the momentum of a variable.
The calculation for ROC is simple in that it takes the current value of a stock or index and divides it by the value from an earlier period.
Subtract one and multiply the resulting number by 100 to give it a percentage representation.
ROC = (current value / previous value  1) * 100

What changes did we make to the RoC?
====================================
(1)  Per the official definition, the original RoC should provide a "rate of change"  i.e., we should say "the 5bar average price change for AAPL is x% per bar"  now norice that the formula doesn't divide by the number of bars (length)  so the reality is, the results is more of "the 5bar price change for apple is x% for the full 5 bar length"
 what is wrong with that ? nothing really, but it's harder to use that number to set my trade target or exit. i need the indicator to give me a number that represents the "average change per bar" so i can use it to "design my trade target and my exit loss"  so in the RRoC, we divide the change by the number of bars used in the settings
The updated formula would be : RoC = (current value / previous value 1 ) * 100 / length
(2)  Dual Length: we make the RoC relative, by adding a longer (or slow) RoC
 the idea here is simple  imagine you're driving your car beside a moving train, your car will not "breakout" from the train until your speed (= distance gain per unit of time) is faster than the train  so in reality, your baseline is not 0 speed, it's the speed of that train your racing against  makes sense?
 so we add a second length that can act as a baseline  when the Fast RoC exceeds the Slow RoC (your car is faster than the train), a breakout would possibly occur  that breakout may fail (if something interrupts it  my car may breakdown if it can't handle the faster speed :) ) or it can fully materialize if the "context" is favorable.
as we can see on the above chart, we can use the RRoC to identify an incoming possible breakout using that simple "relative speed" concept  and that setup happened not once but twice in our example
the interpretation of this for AAPL would be (for example): "AAPL has been making an average change of 0.22% in the past 20 days, but for the last 5 days, the average change was 0.35%  so it looks like AAPL is gaining short term momentum and may breakout soon"
(3) this is another strong feature: Use for broader context:
 we can set the RRoC for a resolution of  for example  a day, while we look at the 1 hour chart  giving us the ability to trade on a smaller timeframe in the context of a larger timeframe .. this is more of an advanced feature but i hope some will be able to leverage it.
Here's a sidebyside comparison of RRoC vs the classic (builtin) RoC indicator
Conclusion:
============
 The (Relative Rate of Change ) RRoC expands on the concepts presented by the classic Rate of Change ( RoC ) indicator and enables additional insights  especially around the discovery of potential price breakout
 leverage the RRoC indicator settings to tweak it to how your trade (fast length, slow length, resolution, smoothing). the defaults should work for any instrument but may not necessarily be the optimal settings
 use in conjunction with other indicators that can show trend and prevailing sentiment / context  to ensure you get proper confirmation and please get very familiar with how the RRoC works before you use it for live trading.
Comments are welcome  Best of luck

==============
The Relative Rate of Change (RRoC) is an expanded version of the classic Rate of Change ( RoC ) indicator  we apply couple of changes to bring additional insights and signals from that classic Technical Analysis concept  which can help us better visualize the "relative speed of change" of a stock (or whatever we trade), and can work specifically as a "breakout finder" .. please read on if this can be valuable to your trading.
First, a quick review of what is the classic Rate of Change ( RoC )  The below part is from Investopedia definition of RoC

www.investopedia.com...s/r/rateofchange.asp
What is Rate of Change ( ROC )
The rate of change ( ROC ) is the speed at which a variable changes over a specific period of time.
ROC is often used when speaking about momentum, and it can generally be expressed as a ratio between a change in one variable relative to a corresponding change in another; graphically, the rate of change is represented by the slope of a line.
Understanding Rate of Change ( ROC )
Rate of change is used to mathematically describe the percentage change in value over a defined period of time, and it represents the momentum of a variable.
The calculation for ROC is simple in that it takes the current value of a stock or index and divides it by the value from an earlier period.
Subtract one and multiply the resulting number by 100 to give it a percentage representation.
ROC = (current value / previous value  1) * 100

What changes did we make to the RoC?
====================================
(1)  Per the official definition, the original RoC should provide a "rate of change"  i.e., we should say "the 5bar average price change for AAPL is x% per bar"  now norice that the formula doesn't divide by the number of bars (length)  so the reality is, the results is more of "the 5bar price change for apple is x% for the full 5 bar length"
 what is wrong with that ? nothing really, but it's harder to use that number to set my trade target or exit. i need the indicator to give me a number that represents the "average change per bar" so i can use it to "design my trade target and my exit loss"  so in the RRoC, we divide the change by the number of bars used in the settings
The updated formula would be : RoC = (current value / previous value 1 ) * 100 / length
(2)  Dual Length: we make the RoC relative, by adding a longer (or slow) RoC
 the idea here is simple  imagine you're driving your car beside a moving train, your car will not "breakout" from the train until your speed (= distance gain per unit of time) is faster than the train  so in reality, your baseline is not 0 speed, it's the speed of that train your racing against  makes sense?
 so we add a second length that can act as a baseline  when the Fast RoC exceeds the Slow RoC (your car is faster than the train), a breakout would possibly occur  that breakout may fail (if something interrupts it  my car may breakdown if it can't handle the faster speed :) ) or it can fully materialize if the "context" is favorable.
as we can see on the above chart, we can use the RRoC to identify an incoming possible breakout using that simple "relative speed" concept  and that setup happened not once but twice in our example
the interpretation of this for AAPL would be (for example): "AAPL has been making an average change of 0.22% in the past 20 days, but for the last 5 days, the average change was 0.35%  so it looks like AAPL is gaining short term momentum and may breakout soon"
(3) this is another strong feature: Use for broader context:
 we can set the RRoC for a resolution of  for example  a day, while we look at the 1 hour chart  giving us the ability to trade on a smaller timeframe in the context of a larger timeframe .. this is more of an advanced feature but i hope some will be able to leverage it.
Here's a sidebyside comparison of RRoC vs the classic (builtin) RoC indicator
Conclusion:
============
 The (Relative Rate of Change ) RRoC expands on the concepts presented by the classic Rate of Change ( RoC ) indicator and enables additional insights  especially around the discovery of potential price breakout
 leverage the RRoC indicator settings to tweak it to how your trade (fast length, slow length, resolution, smoothing). the defaults should work for any instrument but may not necessarily be the optimal settings
 use in conjunction with other indicators that can show trend and prevailing sentiment / context  to ensure you get proper confirmation and please get very familiar with how the RRoC works before you use it for live trading.
Comments are welcome  Best of luck
