By Islam BarakaDefinitions
In plain terms
CCI uses the window typical-price mean as the center and the same window observations for every distance.
Technical
The contract freezes center, population, denominator, window, current-value inclusion, missing values, and zero-deviation policy.
Scope
It is not median absolute deviation and must not be replaced by standard deviation.
Formula
Mean deviation = sum(abs(x_i - mean(x))) / nMD=\frac{1}{n}\sum_i|x_i-\bar{x}|| Symbol | Meaning | Unit |
|---|---|---|
x_i | window observation i | input unit |
mean(x) | arithmetic mean of the same observations | input unit |
n | number of observations | observations |
Output unit: input unit
Examples
- A governed lesson calculates or identifies Mean Absolute Deviation only after its inputs, window, state, scale, and edge cases are declared.
Common misconceptions
- It is not median absolute deviation and must not be replaced by standard deviation.
Concept relationships
Prerequisites
Required by
Where this concept is used
Tutorials planned
These catalogued topics use this concept, but their complete build has not shipped yet.
- D07-F03-A05 Prerequisite
Evidence and governance
- Mean Absolute Deviation NIST · official standard
Supports: preferred label, short definition, technical definition, formula
Limits: CCI specifically uses the mean of absolute deviations of typical prices from their window arithmetic mean; other centers are different measures.
- Commodity Channel Index TA-Lib · first party technical publication
Supports: variant distinction
Limits: The common 0.015 constant is a convention, and zero-deviation or mixed-adjustment inputs require explicit handling.
- Reviewed by
- fintech-builder-batch-008
- Last reviewed
- 2026-07-29
- Next review
- 2027-07-29
- Record status
- published