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Pastimes : ASK Vendit Off Topic Questions -- Ignore unavailable to you. Want to Upgrade?

To: Jim Baker who wrote (1301)	8/2/1999 5:22:00 AM
From: Vendit™	Read Replies (2) \| Respond to of 19374

Re: What does "Money Flow" tell us? It tells you if cash is flowing into or out of an issue. The direction and steepness of the line is what you should watch. It is an indication of what the smart money is doing, buying or selling. Below is the text book description of the indicator: Money Flow Index The MFI is a volume-weighted variation of Wilder's RSI that is calculated by comparing today's average price to yesterday's average price and then weighing that average by the days volume. The ratio of the summed positive and negative money flows are then normalized on a scale of 100 to zero. Look for tops when a reading of 80 occurs and bottoms when 20 is reached. As with many momentum indicators watch for divergence between it and the stock price when new reaction highs or lows are made. In other words when a stock is falling you will many times see the MFI turn up a day or so in advance of the stock price turing up and the same when a stock is topping, you will notice MFI turn down a day or two before a top is reached. Vendit