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You can also find more about the Demand Index (and many other TA
indicators) at the following site:
http://www.equis.com/free/taz/demandind.html
It is a totally free, online version of Steve Achelis' "Technical
Analyis from A to Z". Achelis is the president of Equis, the company
that publishes MetaStock.
Chip
Free Market & Sector Charts
@ http://coolhistory.com/ChipsCharts
Disclaimer: I don't agree with Richard either! ;-)))
---Richard Leighton Dixon <rldixon@xxxxxxxx> wrote:
>
> I recall fielding a question about the Demand Index several months
ago. I
> found the following about this proprietary indicator. I hope it helps.
>
> Demand Index
>
> Format: DemandIndex(range)
>
> Developed by James H. Sibbet, the Demand index is the ratio between
up and
> down volume and is thought to be particularly valuable due to the
generally
> leading nature of volume data.
>
> In the Demand Index, the total volume for a given day is divided
into two
> portions according to the position of the close between the day's
true high
> - the higher of today's high and yesterday's low - and the true low
- the
> lower of today's low and yesterday's high. True high and true low
eliminate
> the problems of limit days and more appropriately apportion volume
on gap
> days.
>
> The separate up volume and down volume are then smoothed
exponentially. The
> ratio of the smoothed numbers is arrived at by keeping the larger
number -
> whether it is the smoothed up volume or the smoothed down volume -
as the
> divisor. Thus, all results lie between 1 (up volume = down volume) and
> zero. If you plot the Demand Index, a correction is made so that the
data
> will be plotted above or below a central line with the top of the
plot at
> +1 (large up volume and little or no down volume) and - 1 (large down
> volume and little or no up volume).
>
> Reference: James H. Sibbet, Sibbet Publications, 1091 East Woodbury,
> Pasadena, CA 91104 (818-791-5157).
>
> Sorry if this has been posted before....
>
>
> rld
> Richard Leighton Dixon
> rldixon@xxxxxxxx
>
> Disclaimer: Nobody agrees with me.
>
>
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