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Hello all,
I have been using an efs compiled by Garth Doverspike called the Demand Index and I can't begin to tell you how its helped me make money and protect profits - and I still consider myself a novice.
Well, there is a counterpart to the demand index called the Demand Oscillator. It is thought by some guy called Thomas Aspray that the Demand Oscillator makes signals from the demand index easier to interpret and identifies false index signals. I was wondering if someone would help compile the index if I provide the information required to write the script.
So, the information is as follows:
To plot the Demand Oscillator, first calculate Buying Pressure (BP) and
Selling Pressure (SP):
If prices rise:
BP = Volume
SP = Volume + % change in price
If prices decline:
BP = Volume + % change in price
SP = Volume
Because the percentage change is a decimal, make it greater than one by multiplying it by the constant, K:
K = (3C)/Va
where C is the closing price and Va is the volatility average, which is the 10-day moving average of a two-day price range (highest high minus lowest low).
Plotting BP and SP as a histogram gives you the Demand Oscillator. When the BP moves above the SP this is a positive (buy) signal and indicates that the Demand Index is above -1.
Negative (sell) signals are generated when SP moves above BP and the histogram drops below the zero line.
He then goes on to say:
Though the Demand Oscillator generally gives good clean signals, it often lags somewhat, especially on weekly data, where it often generates signals which stay in force four to six months. Though it is quitegood on the buy side, it is often late on the sell side.
To help offset this, I developed the Demand Oscillator Momentum (DOM) and found, preliminarily, that the 5- and 10-period mometums seem to work the best. As with most indicators I use, DOM gives signals in several ways:
1. Long-term signals are generated when DOM moves above or below the zero line.
2. The long-term signal is often preceded by the breaking of an up or downtrend in the DOM.
3. Positive or negative divergences between the DOM and price identify bottom and tops.
Figures 1 through 6 illustrate how the oscillator and DOM signals come through in weekly and daily data.
However, I don't have the information to compile the DOM.
So, if someone could help me a would be truly appreciative.
Cheers
Carlton
P.S. I have attached a copy of the Garth's original demand index.
I have been using an efs compiled by Garth Doverspike called the Demand Index and I can't begin to tell you how its helped me make money and protect profits - and I still consider myself a novice.
Well, there is a counterpart to the demand index called the Demand Oscillator. It is thought by some guy called Thomas Aspray that the Demand Oscillator makes signals from the demand index easier to interpret and identifies false index signals. I was wondering if someone would help compile the index if I provide the information required to write the script.
So, the information is as follows:
To plot the Demand Oscillator, first calculate Buying Pressure (BP) and
Selling Pressure (SP):
If prices rise:
BP = Volume
SP = Volume + % change in price
If prices decline:
BP = Volume + % change in price
SP = Volume
Because the percentage change is a decimal, make it greater than one by multiplying it by the constant, K:
K = (3C)/Va
where C is the closing price and Va is the volatility average, which is the 10-day moving average of a two-day price range (highest high minus lowest low).
Plotting BP and SP as a histogram gives you the Demand Oscillator. When the BP moves above the SP this is a positive (buy) signal and indicates that the Demand Index is above -1.
Negative (sell) signals are generated when SP moves above BP and the histogram drops below the zero line.
He then goes on to say:
Though the Demand Oscillator generally gives good clean signals, it often lags somewhat, especially on weekly data, where it often generates signals which stay in force four to six months. Though it is quitegood on the buy side, it is often late on the sell side.
To help offset this, I developed the Demand Oscillator Momentum (DOM) and found, preliminarily, that the 5- and 10-period mometums seem to work the best. As with most indicators I use, DOM gives signals in several ways:
1. Long-term signals are generated when DOM moves above or below the zero line.
2. The long-term signal is often preceded by the breaking of an up or downtrend in the DOM.
3. Positive or negative divergences between the DOM and price identify bottom and tops.
Figures 1 through 6 illustrate how the oscillator and DOM signals come through in weekly and daily data.
However, I don't have the information to compile the DOM.
So, if someone could help me a would be truly appreciative.
Cheers
Carlton
P.S. I have attached a copy of the Garth's original demand index.
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