Registered User
Joined: 10/22/2005
Posts: 5
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Price relative and Chaiken Money Flow for indicators?
You probably know this but here are the formula's
The formula for Chaikin Money Flow is the cumulative total of the Accumulation/Distribution Values for 21 periods divided by the cumulative total of volume for 21 periods.
The price relative is calculated by dividing the security's price by the value of the S&P 500. If WMT were trading at 60 and the S&P 500 were 1400, then the price relative would be 60/1400, which equals .0428. Should WMT advance to 70 and the S&P 500 to 1450, the price relative would be .0482 (70/1450). The advance from .0428 to .0482 shows the WMT is stronger than the S&P 500. This number is then plotted along the Y-axis to form a line chart. The price relative can be calculated on a daily, weekly or monthly basis; closing prices are normally used.
looking for these 2 indicator's, if you dont have them do you have anything similar or can I create my own indicator?
Thank you,
Ian
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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If you plot this as CUSTOM INDICATOR you will get the Chaikin Money Flow:
((2*C-L-H)/(H-L)*V +(2*C1-L1-H1)/(H1-L1)*V1 +(2*C2-L2-H2)/(H2-L2)*V2 +
(2*C3-L3-H3)/(H3-L3)*V3 +(2*C4-L4-H4)/(H4-L4)*V4 +(2*C5-L5-H5)/(H5-L5)*V5 +(2*C6-L6-H6)/(H6-L6)*V6 +(2*C7-L7-H7)/(H7-L7)*V7 +(2*C8-L8-H8)/(H8-L8)*V8 +
(2*C9-L9-H9)/(H9-L9)*V9 +(2*C10-L10-H10)/(H10-L10)*V10 +(2*C11-L11-H11)/(H11-L11)*V11 +
(2*C12-L12-H12)/(H12-L12)*V12 +(2*C13-L13-H13)/(H13-L13)*V13 +(2*C14-L14-H14)/(H14-L14)*V14 +
(2*C15-L15-H15)/(H15-L15)*V15 +(2*C16-L16-H16)/(H16-L16)*V16 +(2*C17-L17-H17)/(H17-L17)*V17 +
(2*C18-L18-H18)/(H18-L18)*V18 +(2*C19-L19-H19)/(H19-L19)*V19 +(2*C20-L20-H20)/(H20-L20)*V20) / (AvgV21 * 21)
There is no way to plot this vs the SP-500 in TeleChart.
You can plot a standard relative strength vs. the SP-500 but not this indicator vs. the SP-500
- Craig
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Registered User
Joined: 10/7/2004
Posts: 1,006
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Hi Craig,
Can you check your Chaikin MF PCF, stocks with very low volume result in an error message (Formula Error!!! Divide By Zero). Many stocks with less than + - 50k volume return errors, with higher volume stocks the PCF works fine.
I've looked at it but not smart enough to see why.
Thanks
Winnie
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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This PCF will only not calcualte if:
1. The stock has less than 20 days of trading data
or
2. The stock has no volume for the past 21 days.
or
3. The stock did not trade that day (H=L)
Out of the 6,895 stocks in ALL STOCKS only 27 did not calculate a value for this for today.
Do you really want to calculate it for any of these type of stocks? Do you ever want to trade a stock that, at any point in its history, did not trade for 21 days or has a day of no trading?
Do you really care about stocks that are not liquid?
The formula can be adjusted to eliminate this error but I really question if it is necessary.
- Craig
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Registered User
Joined: 1/1/2005
Posts: 2,645
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Craig,
Winnie is quite right. The divide by zero problem in the PCF should be eliminated. Because all denominators are nonnegative and quantized, adding say 0.000001 to each will eliminate the problem without any observable distortion.
Suppose you arrange the All Stocks WatchList alphabetically and try to plot the Custom Indicator while on Zoom 1++. You will find that of the first 10 stocks only 4 will plot at all. There is no reason for the PCF not to be modified to eliminate this problem.
Please note that a stock can trade every day for the 21 days and the PCF still have a divide by zero.
Thanks,
Jim Murphy
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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This is where the practical meets the acedemic, IMHO.
Here are the stocks, when sorting ALL STOCKS by ticker, that do not calculate the formula on zoom 1++:
AAA
Many instances of H=L where it traded less than 1,500 shares.
Its 90-day avg volume is only 3,851
Is this a stock you or winnie would take a position or bother to analyze?
AABC
Many days of no trading (V=0 and/or H=L)
Its 90-day avg volume is only 4,600
AAC
This did not stop having days of no volume or minimum trading until early 2003.
It still has days with volume under 100,000 shares.
On zoom 1 showing 2 years of trading, the indicator plots. How important is are the years before 03 for a technician evaluating the stock now (which is very different than the stock then?)
AACE
90-day volume of only 80,047.
Still many days of trading under 100,000
AAME
Many days of no trading (V=0)
90-day volume of only 3,861
AANB
Many days of no trading (V=0)
Many days of no moves (H=L)
90-day volume of 3,520
I think you see what I mean. In many ways, in my opinion, the indicator not calculating is a nice warning not to spend a second looking at the chart.
For the acedemics, here is the modified formula:
((2*C-L-H)/
(H-L+.000001)*V
+(2*C1-L1-H1)/
(H1-L1+.000001)*V1
+(2*C2-L2-H2)/
(H2-L2+.000001)*V2 +
(2*C3-L3-H3)/
(H3-L3+.000001)*V3
+(2*C4-L4-H4)/
(H4-L4+.000001)*V4
+(2*C5-L5-H5)/
(H5-L5+.000001)*V5 +
(2*C6-L6-H6)/
(H6-L6+.000001)*V6
+(2*C7-L7-H7)/
(H7-L7+.000001)*V7
+(2*C8-L8-H8)/
(H8-L8+.000001)*V8 +
(2*C9-L9-H9)/
(H9-L9+.000001)*V9 +
(2*C10-L10-H10)/
(H10-L10+.000001)*V10 +
(2*C11-L11-H11)/
(H11-L11+.000001)*V11 +
(2*C12-L12-H12)/
(H12-L12+.000001)*V12 +
(2*C13-L13-H13)/
(H13-L13+.000001)*V13 +
(2*C14-L14-H14)/
(H14-L14+.000001)*V14 +
(2*C15-L15-H15)/
(H15-L15+.000001)*V15 +
(2*C16-L16-H16)/
(H16-L16+.000001)*V16 +
(2*C17-L17-H17)/
(H17-L17+.000001)*V17 +
(2*C18-L18-H18)/
(H18-L18+.000001)*V18 +
(2*C19-L19-H19)/
(H19-L19+.000001)*V19 +
(2*C20-L20-H20)/
(H20-L20+.000001)*V20) /
(AvgV21 * 21+.000001)
- Craig
Here to Help!
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Registered User
Joined: 10/7/2004
Posts: 1,006
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Hi Craig,
Since I don’t use the Chaikin Indicator, I am always looking for another advantage. The beauty about this forum it brings out all kinds of requests from (why on earth would you want to use this, to WOW, this could be very useful) Before I will use an Indicator or PCF I will take it for a test drive and take it through the paces to see if it something I can be comfortable using.
Since you asked, I rarely consider trading stocks less than 500k average daily volume or under $10, these are my first two primary filters. As you noted, my post was purely academic.
This morning I also spotted Bruce’s post and I believe this also corrects the problem.
Chaikin Money Flow Indicator
Thanks again to you, Bruce and bustermu
Winnie
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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It was my pleasure. I hope I did not come off as argumentative. I do think we can get lost in the numbers and math and forget we are analyzing stocks that we are considering taking action on.
- Craig
Here to Help!
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Registered User
Joined: 10/7/2004
Posts: 1,006
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Hi Craig,
No, I didn’t consider it as argumentative, I though of it as constructive guidance.
Thanks
Winnie
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Registered User
Joined: 2/19/2006
Posts: 89
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I am sorry that I am late to the discussion but somehow becuase of the various links, formula's etc.. I got lost as to which one is correct. Can someone post the correct custom formula indicator or provide a link to it.
Thank You
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Registered User
Joined: 10/7/2004
Posts: 1,006
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Deion,
Both Craig's and Bruce's PCFs are the same and correct, and will eliminate the Divide By Zero problem.
Craig's: this Topic; Posted : Saturday, April 01, 2006 5:45:26 AM
Bruce’s: on Topic; Chaikin Money Flow Indicator; Posted : Wednesday, March 29, 2006 2:26:57 PM
Chaikin Money Flow Indicator
Winnie
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Registered User
Joined: 1/1/2005
Posts: 2,645
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Craig,
Thanks to you, we now have a valuable tool to cull stocks of only academic interest.
For the Charts With Notes WatchList:
1) The first that will not plot your Custom Indicator on Zoom 1++ is #4 NXXI.
2) The first that will not plot your Custom Indicator on Zoom 9 is #26 CEPH.
3) Of the first 100 stocks, 14 will not plot your Custom Indicator on Zoom 1++.
For the Standard and Poors 500 Component Stocks WatchList:
1) Ten will not plot your Custom Indicator on Zoom 1++.
For the All Stocks WatchList:
1) Of the 6888 stocks, 3284 will not plot your Custom Indicator on Zoom 1++.
Can you always tell whether a stock is of practical interest or of only academic interest? Your Custom Indicator only culled 48% of the All Stocks WatchList. Do you have any further suggestions for culling stocks of only academic interest?
Thanks,
Jim Murphy
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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Jim, if my post or use of "acedemics" bothered you, I regret that. My opinion above is pretty clear and I am not going to engage in this further.
I made my point and then posted a version of the formula that would not get the error. You know why a stock will not plot the indicator at a certain zoom. I gave a sample of my thoughts on a few stocks to explain my opinion.
I take the tone of your post above as sarcastic and antagonistic.
I am not participating in such a discussion. There is nothing more for me to say on this subject and you are not trying to learn something from me that you don't already know about the stocks or the indicator.
- Craig
Here to Help!
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Registered User
Joined: 1/1/2005
Posts: 2,645
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QUOTE (Craig_S) I take the tone of your post above as sarcastic and antagonistic.
I am not participating in such a discussion. There is nothing more for me to say on this subject and you are not trying to learn something from me that you don't already know about the stocks or the indicator.
Craig,
How does the above fit with the previous statsment of yours directed at me:
"In the future, please avoid statements like "Since you have not edited the statement, you must feel it is true." I don't assume what you feel or think and I deserve the same. There is a lot of reasons why I might of not edited the statement that are not me feeling it was a true statement."
I apologize for the facts if they offend you, but they exist quite independent of me and any academecians.
Thanks,
Jim Murphy
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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I am not disputing any facts anywhere in my statements above. I am not offended by anything in this thread.
There are stocks that will, at certain or all zooms, not plot the custom indicator. I am not saying otherwise.
We've covered why a stock won't plot the indicator.
I only offered an opinion on such stocks. If you disagree that these stocks are viable or that a past thinly traded history is significant in analysis than "cheers". These are not facts, they are opinions and the fact that they differ is, in no way, offensive to me.
I should not of posted "you are not trying to learn something from me that you don't already know about the stocks or the indicator." It was hypocritical and poorly worded on my part.
- Craig
Here to Help!
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Registered User
Joined: 1/1/2005
Posts: 2,645
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QUOTE (Craig_S) I only offered an opinion on such stocks. If you disagree that these stocks are viable or that a past thinly traded history is significant in analysis than "cheers". These are not facts, they are opinions and the fact that they differ is, in no way, offensive to me.
Craig,
There you go again:
"I don't assume what you feel or think and I deserve the same."
I am usually quite careful not to express my opinion as it is of no value to anyone. Since I have not expressed any opinions, whose opinions are yours differing with?
Thanks,
Jim Murphy
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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I think the "if" at the beginning of my statement is important. I was not assuming anything about how you think or feel.
Reading through this I guess we agree on the facts:
1. My original version does not display on all stocks at all zooms
2. The later version posted by me does
So I guess that's it unless there is something else we should discuss.
- Craig
Here to Help!
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Registered User
Joined: 1/1/2005
Posts: 2,645
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Craig,
You may be interested in Bruce's post of 02/13/06 12:03:53 PM and those which surround it. A similar topic is involved.
Thanks,
Jim Murphy
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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Read it, thanks.
- Craig
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