Coppock Curve explained

Momentum

What Coppock Curve measures

The Coppock Curve is a long-horizon momentum indicator originally designed to identify major bottoms in broad market indices, built from a weighted sum of two long-period rate-of-change calculations (traditionally 14 and 11 months on monthly charts), smoothed with a 10-period weighted moving average. It was commissioned specifically to answer "how long does a grieving process typically last" as a metaphor for market bottoms recovering from a downturn.

How Coppock Curve readings are interpreted

The classic Coppock signal is the indicator turning upward from below zero — historically associated with major market bottoms on index-level monthly charts. On daily data (as computed here) it functions as a slower, longer-horizon momentum gauge rather than a precise bottom-calling tool, since the original design assumed monthly bars.

Conventional Coppock Curve levels

Coppock turns upward while below zero: classic long-term bottom signal (as originally designed, on monthly index charts)
Coppock crossing zero: broader long-term trend confirmation
A Coppock reading well below zero and still falling: momentum still deteriorating, no bottom signal yet
Because of the long lookbacks involved, readings change slowly — day-to-day movement is not meaningful

Where Coppock Curve works, and where it does not

Originally built for monthly index charts to call major market bottoms — applying it to individual stocks or shorter timeframes departs from its original design and the signal reliability is correspondingly less proven. On this app's daily data it should be read as a slow-moving long-term momentum trend, not a precision bottom-caller.

Indicators commonly read alongside Coppock Curve

KST: Both are long-horizon momentum tools with a similar purpose — agreement between the two on a turning signal is a stronger combined case for a major trend shift
Volume: Rising volume alongside a Coppock upturn adds conviction
200-day SMA: A Coppock upturn while price reclaims its 200-day SMA is a more complete long-term trend-change picture

Known limitations of Coppock Curve

Designed for monthly index data — its behavior on daily single-stock data is a meaningful departure from its original, most-validated use case
Extremely slow to react given the long lookbacks and smoothing involved — not useful for anything but long-horizon position decisions
Rare, infrequent signals make it hard to build statistical confidence for any single security

Coppock Curve in practice

Treat as a background, long-horizon context indicator rather than an active trading signal
Most appropriate for long-term investors assessing whether a multi-month or multi-year downtrend may be turning
It produces comparatively few readings — this indicator is built to fire rarely, at major turning points only
Pair with KST and a long-term moving average before treating any single Coppock signal as actionable

Other momentum indicators

Fisher Transform
Balance of Power
RSI — Relative Strength Index
MACD

Testing ideas built on Coppock Curve

A reading of Coppock Curve can be written as an exact rule and checked against historical data — as a full strategy with entries, exits and costs, or as a single condition and what followed it:

How to backtest a trading strategy without code
Event analysis: what follows a market event

Plot it yourself. Add this indicator to a chart, change every parameter and watch the line move, then backtest how the rule would have behaved on historical data — free on the S&P 500 ETF, no card.

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This is reference material, not advice. It describes what each indicator measures and how its readings are conventionally interpreted. Nothing here is a recommendation to buy or sell anything, and no indicator predicts future prices. GU Analyser is an analytical tool — no money is ever traded here.