Indicators · Beginner

Williams %R Explained

Zero is the top of the range and minus 100 is the bottom. The scale reverses the intuition most people arrive with.

Last reviewed 15 September 2026 by the MarketPro research desk · Editorial policy

In short

Williams %R measures where the current close sits within the high-to-low range of the last 14 periods, plotted from 0 at the top of the range to minus 100 at the bottom. Readings above minus 20 are conventionally called overbought and below minus 80 oversold. It is the stochastic %K calculation viewed from the top of the range instead of the bottom, so %R equals %K minus 100 on the same lookback.

What to remember

%R equals stochastic %K minus 100. The two produce identical information, so running both is not confirmation.
The scale is inverted. Zero is the top of the range, minus 100 the bottom, and minus 20 is a high reading.
It is unsmoothed, so it jumps when an old high or low rolls out of the window even if the current bar barely moved.
The exit from a zone carries more than the reading itself. Crossing back up through minus 80 says more than sitting at minus 90 for two days.

Lesson 16 of 22 in Trading indicators

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Williams %R measures where the current close sits inside the high-to-low range of the last 14 periods, plotted on a scale from 0 at the top of the range to minus 100 at the bottom. If that sounds familiar, it should: it is the stochastic %K calculation, viewed from the other end.

It is stochastic %K, shifted by 100

Stochastic asks how far the close is above the lowest low. Williams %R asks how far the close is below the highest high. Those are two ways of describing the same position, so the two indicators produce the same information with a fixed offset between them.

Written out, %R is (highest high - close) / (highest high - lowest low) x -100. Take any bar and compute both: %K of 80 is %R of minus 20, %K of 35 is %R of minus 65. The relationship is exactly %R = %K - 100 on the same lookback. Knowing that saves you from a common mistake, which is running both and treating their agreement as confirmation.

Working one reading on EUR/USD

Over the last 14 hourly bars, the highest high is 1.0920 and the lowest low is 1.0800. The range is 120 pips. The current bar closes at 1.0896. This is deliberately the same bar the stochastic lesson works through, so the two readings can be compared directly.

The close is 24 pips below the high. Twenty-four divided by 120 is 0.20, and multiplied by minus 100 that is minus 20. Williams %R reads minus 20, which is the conventional overbought line.

Read it literally. The close finished 20 per cent of the way down from the top of the last 14 bars. That is a statement about position within a range, and nothing else. It says nothing about whether the range is part of a trend, nothing about whether 1.0920 is a significant level, and nothing about what happens next.

Minus 20 does not mean sell

The scale reverses the intuition a lot of people bring to it. Minus 20 is a high reading, near the top of the range, and is called overbought. Minus 80 is a low reading, near the bottom, and is called oversold. Zero is the extreme top and minus 100 the extreme bottom.

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The thresholds carry the same problem every oscillator has. During a sustained advance almost every bar closes near the top of its own recent range, so %R sits between 0 and minus 20 for the whole move. Selling each time it crosses back below minus 20 in that environment means repeatedly taking positions against the strongest movement on the chart, and each one gets stopped as the trend continues.

There is a second reading worth knowing. Because %R responds to a new extreme immediately, it reaches 0 on any bar that closes at a new 14-period high. In a market that is trending, that happens over and over, so a string of zeros is a description of persistent strength rather than a warning. A trader who reads every touch of zero as an exhaustion signal will fight the entire move.

Speed is the whole trade-off

Lookback	Behaviour	Best suited to
%R(7)	Reaches the extremes constantly	Very short-term scalping, with a filter
%R(14)	The standard convention	Intraday and swing use
%R(28)	Rarely pins at the extremes	Slower confirmation, fewer signals

Williams %R is unsmoothed, which is why it is faster and jumpier than most platforms' default stochastic. It reacts to a single new high or low immediately, and it can jump many points when an old extreme rolls out of the lookback window even if the current bar barely moved. That is not noise in the data. It is a structural property of any indicator whose denominator is a rolling high-low range.

Divergence applies here as it does to every oscillator. Price making a higher high while %R makes a lower high says the latest push closed less far up its own range than the previous one. As with the rest, it is an early warning with no clock attached, and the swing you are measuring only becomes a swing once price has moved away from it.

Choosing one of the two, not both

Do not run %R and stochastic together. They are the same measurement, so their agreement is arithmetic rather than evidence.
Add a trend filter before acting on any extreme. Only take readings that agree with the broader direction, and ignore the rest.
Watch the exit from the zone, not the entry. %R crossing back up through minus 80 has more information than %R sitting at minus 90 for two days.
Pair it with a different family. A volatility or trend measure adds information; a second oscillator repeats the first.

The practical version is short. Establish direction from structure or a long moving average. In an uptrend, wait for %R to fall below minus 80 and turn back up, which describes a pullback that has run its course. Place the stop below the swing that produced the pullback rather than at a fixed distance, since a stop chosen for comfort gets hit by ordinary movement, and size the position from that distance on the position size calculator. The broader argument for taking only signals that agree with the trend, and for accepting that a share of them will fail regardless, is in the risk management guide.

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Written and reviewed by the MarketPro research desk

MarketPro is a trading-signal and trading-education app operated by Harajuku Holdings LTD (Cyprus). Our signal desk publishes and tracks every trade idea in-app, and every page here is checked against the app's live behaviour before publishing. Last reviewed 15 September 2026. How we produce signals and content · About MarketPro

FAQ

Williams %R Explained: questions

What does a Williams %R of minus 20 mean?

It means the current close finished 20 per cent of the way down from the highest high of the last 14 periods, so price is near the top of its recent range. That is the conventional overbought threshold. It describes position within a range and carries no information about whether the range sits inside a trend or about what happens next.

Is Williams %R the same as stochastic?

They are the same measurement expressed differently. Stochastic %K measures distance above the lowest low and Williams %R measures distance below the highest high, so on the same lookback %R equals %K minus 100. The practical difference is that most platforms smooth stochastic by default while Williams %R is usually plotted raw, which makes it faster and jumpier.

How do you avoid false signals with Williams %R?

Establish the broader trend first and act only on readings that agree with it, since an oversold reading inside a downtrend is the trend working rather than an opportunity. Waiting for the line to leave the extreme zone rather than acting while it sits there removes many premature entries. Pairing it with a tool from a different family, such as a volatility or trend measure, adds information that a second oscillator would not.

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