mahkoh
1,065 posts
msg #107954
- Ignore mahkoh
modified |
9/7/2012 6:17:12 PM
The Law of Effort and Result
For a stock price to move (result), how much volume (effort) is associated with the move.
When the result (price) and effort (volume) are in harmony, the trend is likely to continue. However, if they are out of sync, for example, when volume is large, but price moves little, the current trend is in danger, and defensive measures must be taken.
Rick Redmont gives a simple example:
“You are looking at a stock. It trades 10,000 shares and goes up one point on the first day. [You see the effort and result.] The same thing happens on the second day. On the third day, it trades 20,000 shares and goes up 1 point. On the fourth day, it trades 40,000 shares and goes up half a point. On the fifth day, it trades 80,000 shares and is unchanged. [This group forms a cause, the effect of which is demand becomes exhausted.]
“On the third day, you had to exert twice as much effort to get the same result (as the first day),” Redmont noted. “The key to analyzing supply and demand is that the demand side burns itself out.”
“When the buying is through and satisfied-there is always supply there. That’s why prices go down faster-because supply is always there and demand is not. All you have to do is withdraw people who want to buy and prices fall.”
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mahkoh
1,065 posts
msg #107973
- Ignore mahkoh
modified |
9/9/2012 5:38:44 PM
Not sure in the above article which move the author refers to. I assume it would not be the close to close move, but does he refer to the range between high and low or open and close. With that in mind I decided to see what the filter would do if I change "high - low" to "close - open".
Obviously I will need the absolute value of "close - open" so I use the following
but get very odd results
Removing all non essential:
compare this to
All values in the last filter's y column are 1!
Can anyone help me out here?
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mahkoh
1,065 posts
msg #107974
- Ignore mahkoh
modified |
9/9/2012 6:11:53 PM
Well, apparently I have to code it like this
set{x1,close - open}
set{x,abs(x1)}
odd, since in the help examples
http://help.stockfetcher.com/sfhelp/?id=100314&isiframe=&isiframe=
this syntax is used
set{body, abs(close - open)}
set{body_dev,cstddev(body,15)}
show stocks where body_dev is above 2.0
Anyway, work in progress
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