The oscillator gives three main down signals.
– Continuation of the downtrend. A downtrend has formed on the chart, and the rate of change line has crossed the zero level from top to bottom and is going down.
– Trend reversal. You can open a trade after the ROC line leaves the overbought zone. This is a situation when the indicator goes down above the overbought level, crosses it from top to bottom and continues to go down.
– Bearish divergence.