To: da_cheif™ who wrote (161 ) 4/17/2003 5:44:49 PM From: velociraptor_ Read Replies (1) | Respond to Your arguement regarding the A/D line is flawed in both time and price depending on your perspective. Think about it...5 days up, 5 pennies a day and 1 day down 3 points. Over all, price goes down, down down, but the A/D line rises. In fact, even in a bear market, the down waves are likely to be more impulsive and sharper while the up moves take longer in time and are corrective. That means more up days (or weeks) than down and again you have positive bias for the A/D line while the market continues to be in a bear with a down trend intact. Since bear markets are statistically only 38% of the time of a bull market, again you have a time bias to the positive and should see more upward bias in the A/D even taking into consideration the correctives in a bull. Overall, the A/D line will likely always have a positive bias and the longer the time frame you use, the more it gets smoothed out towards the positive bias simply because bull moves are statistically longer in duration. A monthly A/D will smooth out even more of the correctives and would probably not even register bear market correctives lasting several years. The larger the time frame, the more you will hide the detail of what is going on for the current period. The daily A/D in this respect becomes more important then the weekly.
