|
MetaStock
Indicator - Tick
Line Momentum Oscillator
rev. 01/06/97
In his article "Using
The Tick In A Short-Term Indicator", in
the January 94 issue of TASC, Daniel E.
Downing presents the Tick Line Momentum
Oscillator.
Taken from Stocks
& Commodities, V. 12:1 (42-44): Using The Tick
In A Short-Term Indicator by Daniel E. Downing
"The tick
index, the net difference of the numbers of stocks
last traded on an uptick from those last traded on
a downtick , is a well-known indicator, but it's
got a problem. The raw number result is volatile,
perhaps too volatile for some. What to do? here,
then, is a way to smooth out the noise to identify
short-term trading opportunities.
The tick is a
basic unit for the markets, watched with
fascination during periods of turmoil and periods
of enthusiasm. It is quoted throughout the day on
most quote services. In addition, the closing tick
value can be found on the market statistics pages
of financial newspapers such as Barron's and The
Wall Street Journal. Let me present, then, the
tick line momentum oscillator, which is based on
the closing value for the New York Stock Exchange
(NYSE) tick indicator. The oscillator has been
shown to have a good track record of determining
when the NYSE is overbought or oversold on a
short-term basis. The formula for the tick line
momentum oscillator is simple and can be easily
calculated without a computer, although a
spreadsheet version can be found in the sidebar,
"Tick line momentum." Finally, the
oscillator is straightforward and simple to
apply."
The MetaStock
formula for the Tick Line Momentum Oscillator is:
| Mov(
ROC( Cum( If( C ,> ,Ref( Mov(C ,10 ,E
) ,-1 ) ,+1 ,If( C ,< ,Ref( Mov( C
,10 ,E ) ,-1 ) ,- 1 ,0 ) ) ) ,5 ,$ ) ,5
,E ) |
For interpretation
refer to Mr. Downing's article. |
