Detrended Price Oscillator
Removes the long-term trend from price to expose shorter cycles; useful for timing cyclical highs and lows in range-bound conditions.
DPO = Close_{t − (n/2 + 1)} − SMA(n) shifted back (n/2 + 1) barsThe Detrended Price Oscillator subtracts an SMA shifted back by (n / 2 + 1) periods from the current close, effectively cancelling out the dominant trend and leaving oscillations around the cycle midpoint. The lookback is typically 20–21 periods.
DPO does not extend to the current bar (by design) — it looks back at past cycles, not forward. It helps traders measure the length and amplitude of a recurring cycle (e.g. a 20-day swing cycle) and anticipate when price is likely to peak or trough relative to that cycle. It should not be used to identify the direction of the main trend.