Concept
Ratio Charts
Ratio Charts are Breadth, Sentiment & External Data concepts. The Library holds 3 implementations, each one a working definition you can pull into Quant.
Top Ratio Charts indicators
3 total
What are Ratio Charts?
A ratio chart plots one instrument's price divided by another's, bar by bar, so the line rises when the numerator outperforms and falls when it underperforms. Dividing strips out the direction both legs share and leaves pure relative performance, which is why ratio charts are the working surface of relative strength comparative analysis: sector versus index, stock versus sector, Bitcoin dominance, stablecoin dominance, copper versus gold, stocks versus bonds.
Standard technical tools apply to the ratio series itself: practitioners draw trendlines on it, run moving averages over it, and trade its breakouts. The essential caveat is that a ratio says nothing about absolute direction. It rises just as readily when both legs fall and the numerator falls less. Construction details also matter, since currency, dividends, and index methodology can each tilt the line.
How traders use it
- As rotation input: ranking sectors or assets by the trend of their ratio against a common benchmark drives overweight and underweight decisions, the same logic a sector rotation model formalizes.
- As crypto regime context: Bitcoin dominance and stablecoin dominance are ratio charts of market capitalizations, and a rising stablecoin share is commonly read as de-risking within the asset class.
- As a pairs tool: extremes and breakouts in the ratio between two related instruments generate long/short candidates, the discretionary cousin of a statistical pairs trading stack.
Ratio Charts vs related concepts
Relative Strength Comparative: RS comparative is the benchmark-specific application: your symbol divided by an index. Ratio charts are the general construction, usable between any two instruments for any relative question.
Ratio/spread Charts: The broader charting family that also includes subtraction. Ratios divide and suit percentage comparisons across different price scales; spreads subtract and suit dollar-quoted relationships like futures legs.
Relative Rotation Graphs: An RRG normalizes many relative-strength lines and their momentum onto one four-quadrant plot. A ratio chart shows a single relationship through time; RRGs rank a whole universe at a glance.
Related concepts · Relative strength & rotation
Concept family
Breadth, Sentiment & External Data
63 concepts mapped · 61 in the Library
Ratio Charts FAQ
What does a rising ratio chart actually mean?
Only that the numerator is outperforming the denominator over that stretch. Both assets can be falling while the ratio rises, because the numerator is simply falling less. Before treating a rising ratio as bullish, check the absolute charts of both legs so you know whether you are looking at strength or merely lesser weakness.
Can you apply indicators to a ratio chart?
Yes. A ratio is just another time series, so moving averages, RSI, trendlines, and divergence checks all run on it, and doing so is standard practice in relative strength work. Remember that the outputs describe relative performance only, and a thin or differently scaled denominator can make the ratio jumpy when neither leg is.
Build Ratio Charts your way.
Quant writes, tests, and refines it with you — then it runs on LuxAlgo charting or ports to TradingView.