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

To: sandintoes who wrote (18731)	2/2/2001 4:08:38 AM
From: DOUG H	Read Replies (2) \| Respond to of 19374

Sandi, These are the explainations of money flow and OBV from AskR site. I've blackened the part about how to use the indicators. For how the indicators are formulated you may want to ask Walkingthedog. His mathmatical skills are much better than mine. 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. On Balance Volume (OBV) OBV is a very popular indicator developed by Joseph Granville and is a running total of volume that reflects accumulation or distribution. Each day's volume is assigned a positive or negative value depending on whether prices closed higher or lower that day and a running total is kept by adding or subtracting the volume depending on the direction for the day. The direction of the OBV line is the thing to watch not the actual level. This indicator will often confirm underlying strength or weakness of a price trend and will often signal a top by declining while the stock is still rising, indicating big money is leaving the stock. Conversely, a rising OBV in the face of a declining price trend or an OBV that refuses to confirm a new stock reaction low could indicate smart money is moving in and a bottom may be at hand.