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RE: Divergence between the Close and an Indicator for MACD and RSI(14)



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<SPAN 
class=252123304-08062002>Bill:
<SPAN 
class=252123304-08062002> 
I think you have an 
error in
 "The 
interpretation of the indicator output is as follows:- .08 (80%) and lower 
is divergence between the Close and the MACD"
<SPAN 
class=252123304-08062002> 
either .08 should be 
.80 or (80%) should be 8%
<SPAN 
class=252123304-08062002> 
Which do you 
mean?
<SPAN 
class=252123304-08062002> 
<FONT face=Tahoma 
size=2>-----Original Message-----From: owner-metastock@xxxxxxxxxxxxx 
[mailto:owner-metastock@xxxxxxxxxxxxx]On Behalf Of 
billhebertSent: Friday, June 07, 2002 9:28 PMTo: 
metastock@xxxxxxxxxxxxxCc: mpc@xxxxxxxxxxxxxxxxxSubject: 
Re: Divergence between the Close and an Indicator for MACD and 
RSI(14)

Maurice,
 
I will provide the code for a RSI(14) diveregence as well as a 
MACD(12,26,--) divergence.  
Sorry, it took a few days to locate. Out of town most of the week (Newport 
Beach) with day job.
 
Attachment will show how it is used.  
 
This formula shows divergence between price and the indicator not the trend 
line divergence you 
may be looking for when their are say increasing price peaks and decreasing 
indicator peaks as 
a leading indicator for a potetial price reversal.
 
Divergence Between the Close and an Indicator 
 
 The following formula will calculate the correlation of the Close 
andthe MACD. It is written 
using a "long form" MACD so that the time periods used by the MACD may be 
changed. 
This indicator shows "divergence" between the close and the 
indicator:
 
Divergence Between the Close and MACD
 
Correl(((Sum(Cum(1)*(Mov(C,12,E)-Mov(C,26,E)),100))-(Sum(Cum(1),100)*Sum((Mov(C,12,E)-Mov(C,26,E)),100)/100))/((Sum(Power(Cum(1),2),100))-(Power(Sum(Cum(1),100),2)/100)),((Sum(Cum(1)*C,100))-(Sum(Cum(1),100)*Sum(C,100)/100))/((Sum(Power(Cum(1),2),100))-(Power(Sum(Cum(1),100),2)/100)),12,0)
 
 The interpretation of the indicator output is as follows:- .08 
(80%) and lower is divergence between the Close and the MACD.- 1 is very 
strong divergence.+ 1 is very strong correlation.
 
The formula was constructed this way so that most other indicators maybe 
used in place of the MACD.For example here is the same indicator using the 
RSI(14): Divergence Between the Close and 
RSI
 
Correl(((Sum(Cum(1)*(RSI(14)),100))-(Sum(Cum(1),100)*Sum((RSI(14)),100)/100))/((Sum(Power(Cum(1),2),100))-(Power(Sum(Cum(1),100),2)/100)),((Sum(Cum(1)*C,100))-(Sum(Cum(1),100)*Sum(C,100)/100))/((Sum(Power(Cum(1),2),100))-(Power(Sum(Cum(1),100),2)/100)),12,0)
 
Bill
 
----- Original Message ----- 

From: "Maurice Cruz" <<A 
href="mailto:mpc@xxxxxxxxxxxxxxxxx";>mpc@xxxxxxxxxxxxxxxxx>
To: <<A 
href="mailto:metastock@xxxxxxxxxxxxx";>metastock@xxxxxxxxxxxxx>
Sent: Wednesday, June 05, 2002 6:08 PM
Subject: RSI divergence
> Hi,> > Is there an exploration formula out 
there that would enable me to scan> for negative or positive divergences 
on a 14 day RSI?> > Regards,> Maurice> >