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Strategies & Market Trends : today's chart
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To: Eliot A who wrote (359)8/11/1997 1:52:00 PM
From: TechTrader42   of 1267
 
Average Price 1: (((H+L+C)/3)-Mov(C,28,S))/.015*Std(C,28) -- Yellow

Average Price: (((H+L+C)/3)-Mov(C,28,S))/(.015*Std(C,28)) -- Purple

Eliot: They're not really the same. Note the parentheses in the denominator in Average Price. Average Price 1 grew out of Paul B.'s successful attempt to reproduce the plot in Bill's BNS charts. But Average Price is the traditional formula for CCI. Average Price 1 gives an entirely different result because of the lack of parentheses. You get a huge result during times of volatility, because the numerator is divided by .015 and then multiplied by standard deviation, instead of being divided by (.015 times the standard deviation). Plot the two and you'll see. Bill and Paul found Average Price 1 to be useful in anticipating moves, even though it wasn't a traditional formula.

Remember: Fortune has infinite formulas.

Brooke
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