|
PureBytes Links
Trading Reference Links
|
My problem with OBV is that I think it is
flawed because it treats all price movements the same.
Using OBV, a 1,000,000 volume is the same
whether the stock moves .01 or $10. Volume is energy in and price
change is energy out. The two example are widely different. For this
type of analysis, I prefer VPT = Volume
Price Trend = take daily price movement divide by previous day's close and
multiply that percentage movement times that day's volume and plot. There is a
good article on VPT in the 1970 Investor's
Intelligence Encycl. of Stock Market Techniques.
Enjoy,
Norman Winsk
<BLOCKQUOTE
style="BORDER-LEFT: #000000 2px solid; MARGIN-LEFT: 5px; MARGIN-RIGHT: 0px; PADDING-LEFT: 5px; PADDING-RIGHT: 0px">
----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
Stan Book
To: <A
href="mailto:realtraders@xxxxxxxxxxxxxxx";
title=realtraders@xxxxxxxxxxxxxxx>realtraders@xxxxxxxxxxxxxxx
Sent: Monday, March 05, 2001 11:17
AM
Subject: RE: [RT] Re: Bear Trap
<SPAN
class=90374615-05032001>GB,
<SPAN
class=90374615-05032001>
The
theory is that volume leads price. your chart suggests lower prices ahead, but
does not negate an intervening rally.
<SPAN
class=90374615-05032001>
I
have a few problems with OBV. First, it seems to me that OBV works better for
individual issues than for indexes. Second, OBV may not be the best measure of
accumulation / distribution. Third, One never knows if a divergence is just an
aberration this time or, if valid, how long it will take prices to to be
pulled in the direction of volume.
<SPAN
class=90374615-05032001>
<SPAN
class=90374615-05032001>Attached is a proprietary volume based oscillator that
does a fair job of anticipating (or confirming) Dow turns. Even so, an
oscillator extreme can anticipate a significant price extreme by 2 to 5
weeks.
<SPAN
class=90374615-05032001>
<SPAN
class=90374615-05032001>
<FONT face="Times New Roman"
size=2>-----Original Message-----From: Gitanshu Buch
[mailto:onwingsofeagles@xxxxxxxxxxxxx]Sent: Monday, March 05,
2001 7:23 AMTo: realtraders@xxxxxxxxxxxxxxxSubject:
[RT] Re: Bear Trap
Just started catching up on recent posts...
So I suppose this divergence in OBV v/s Price favors
Price?
Thanks.
GitanshuTo unsubscribe from this
group, send an email
to:realtraders-unsubscribe@xxxxxxxxxxxxxxxYour
use of Yahoo! Groups is subject to the <A
href="http://docs.yahoo.com/info/terms/";>Yahoo! Terms of Service.
To
unsubscribe from this group, send an email
to:realtraders-unsubscribe@xxxxxxxxxxxxxxxYour
use of Yahoo! Groups is subject to the <A
href="http://docs.yahoo.com/info/terms/";>Yahoo! Terms of Service.
Yahoo! Groups Sponsor
The Perfect Storm
The Patriot
U571
Erin Brockovich
More Movies...
To unsubscribe from this group, send an email to:
realtraders-unsubscribe@xxxxxxxxxxxxxxx
Your use of Yahoo! Groups is subject to the Yahoo! Terms of Service.
|