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====================And now for something special============================
You have indeed sent me a masterpiece ("Everything you always wanted to know about
Bollinger Bands, but were afraid to ask!!") and I wish to convey my seriously belated thanks.
Please accept my apolgies for the long silence.
Have you seen Edward D. Dobson's book on BBs? It has a decent bibliography, which
might interest you. The book itself is not expensive: $8.00.
I am still pondering things (such as the meaning of life). . . and I will get back to you when things
come a little clearer to me - about the BBs, that is :-)
Has it been cold enough for "schoonrijden"?
With best regards,
Philip
Hello again Philip,
I also should have replied to your nice TA-thank you-mail sooner, never got around to do so, but
hereby thanks for the appreciation.
Also, to let you know that since all of yours and this Lists' discussioning, I got to know the BB's better
and better, and now can't do without them anymore(using its 10 day "version").
I have not got around to get E.D. Dobsons' book as yet, but most certainly will in the near future. Thanks
for informing me.
Last winter was not cold enough for outside-"schoonrijden", instead its been done indoors, where
its warmer, on ice (?!?!).
Please find below the MS+others sources' explaination of the Demand Index and also some
MSCSU-List members' contributions on the subject.
As with the BB's let us(+list) know of any of your DI - findings.
Regards,
Ton Maas
Ms-IRB@xxxxxxxxx
=========================================================
>See also "TA from A to Z - S Achelis" - the electronic version at:
>http://www.equis.com/free/taz/demandind.html
==========================================================
>From the MsWin-on-line-help and other sources:
Demand Index (for Metastock6.x) - James Sibbet
Information:
The Demand Index, developed by James Sibbet, which combines volume and price data
in such a way as to indicate a change in price trend, is often a leading indicator of price change.
It is designed so that at the very least it is a coincidental indicator, never a lagging one.
The calculation of this index is relatively complex, however, for this text. The calculations
require 21-column accounting paper to calculate manually.
The Demand Index analysis is based on the general observation that volume tends
to peak before prices peak, both in the commodity and stock markets.
In MetaStock:
MetaStock uses a slight variation on the Sibbet's original Index so that the Index is
displayed on a "normal" y-axis scale. The author's Index is plotted on a scale
labeled +0 at the top, 1 in the middle, and -0 at the bottom.
MetaStock uses a scale from +100 to -100.
Other than the difference in y-axis labeling, the indicator is calculated exactly as
designed by its author.
Syntax, Function + Parameters:
SYNTAX : di()
FUNCTION : Calculates the predefined Demand Index.
PARAMETERS : There are no parameters for the Demand Index.
Interpretation:
There are six "rules" to the Demand Index:
1 · A divergence between the Demand Index and the price trend suggests an approaching
weakness in price.
2 · One more rally to new highs usually follows an extreme peak in the Demand Index
(the Index is performing as a leading indicator).
3 · Higher prices with a lower Demand Index peak usually coincides with an important top
(the Index is performing as a coincidental indicator).
4 · The Demand Index penetrates the level of zero indicating a change in trend (the Index
is performing as a lagging indicator).
5 · When the Demand Index stays near the level of zero for any period of time, a weak
price movement that will not last long is indicated.
6 · A large long-term divergence between prices and the Demand Index indicates a major
top or bottom.
============================================================
> -----Original Message-----
>From: leadership <leadership@xxxxxxxxxxx>
The Demand Index is calculated using ratios of volume weighted by price
change. When the Demand Index diverges from price, it is said to be a
leading indicator of price trend change. When the Demand Index crosses
1.0 it is a lagging indicator of price trend change. Readings near 1.0
indicate low momentum. The exact formula is the copyrighted proprietary
property of James Sibbet (Sibbet Publications, 61 South Lake Avenue,
Suite 301, Pasadena, CA 91101). The Demand Index is available on some
computer software programs. (CompuTrac is correct.) Our previous
computer testing failed to establish any advantage for the Demand Index
compared to many of the more widely available and popular indicators.
RW Colby
-------------------------------------------------------------------------------------------------------
> -----Original Message-----
>From: "rld" <rldixon@xxxxxxxx>
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....
Richard Leighton Dixon
-----------------------------------------------------------------------------------------------------------------
> -----Original Message-----
>From: "Aongus Flood" <aflood@xxxxxxxx>
Augie,
As a fellow engineer, I have a similar fascination with the demand index.
Could you include me in any discoveries with regard to it.
But here is something close to it. This is home brewed, based on fractal
dimension calculations but with some mistreatment of the theories.
Create a new formula/Indicator and paste the following as the function body:
lperiods:=Input("Long Periods?",2,300,11);
speriods:=Input("Short Periods?",1,300,2);
Log((100+(ROC(C,lperiods,%)))/(100+(ROC(C,speriods,%))));
Hope this helps
Aongus
------------------------------------------------------------------------------------------------------------
> -----Original Message-----
> From: Augie Wong [mailto:awong@xxxxxxxxxxxxx]
> Sent: Tuesday, February 17, 1998 10:26 PM
> To: Metastock List
> Subject: Re: MS6.4 Demand Index Profit System Test
I am very interested in the formula of the Demand Index (yes, you guessed it,
I'm also an engineer). Really appreciate it if you would kindly share the
formula or point me in the right direction. Thanks.
Augie Wong
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