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Registered User
Joined: 10/25/2004
Posts: 4
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Yesterday's daily chart of SYNA reflected the $6.23 drop confirmed with TSV, MS, MACD, and Stochastics, but the BOP still was green and above Zero! Can you explain to me why BOP did not confirm what price already did? I am having a difficult time understanding how to use BOP.
Thanks in advance for your comments!
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Worden Trainer
Joined: 10/7/2004
Posts: 65,138
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This goes beyond what the trainers can answer in Ask a Trainer. We don't suggest particular settings and we don’t give advice on interpretation.
I’m moving this post to Stock and Market Talk where other investors will see it. Maybe they will have some input.
-Bruce
Personal Criteria Formulas
TC2000 Support Articles
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Registered User
Joined: 10/7/2004
Posts: 2,126
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I think that you may want to review the definitions and meaning of accumulation and distribution.
Those actions are not instant.
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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One of the strengths of BOP as an indicator is its ability to contradict price. Often it will disagree with TSV and MoneyStream. Sometimes it is right, other times it is wrong. Look in the past on that stock. Were there other times that the stock made a strong move in either direction? How did BOP handle those times? If it contradicted the price movement was it revealing a hidden strength or weakness in the move that later played out?
- Craig
Here to Help!
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Registered User
Joined: 12/30/2004
Posts: 9
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I have been told that you probably need a level two to discover what really went on in that stock for the day.It is why it is a gamble to day trade without all the currant information.If the fundamentals of the stock are good it will correct 95% of the time within a few days or so if in an uptrend.
One level2 you can tell what institutions are selling and how many.You can guess at the reasons why. This is why technical tradeing is so difficult.Fundamentals rule backed up by chart observations.
Then there is the trick of reading fundamentals.CEOs can be heartless concerning the public.Political parties can change the rules for accounting procedures.Getting by the red ink hidden in fundamentals can be tricky. Options and futures can distort values. All of these things must be taken in account before you can even begin to read technicals. They say that price has factored in everything.CEOs believe it for sure.
Then it depends on what sector your in.If the political arena doesn't like your sector that is a good time to be looking at the stocks in it.Houseing stocks going through the roof. What a deal. Stuff like that. They make lots of money.Awfull long cycle though historically.May be running out of buyers in the real market of houses which could mean the stocks might run in to trouble some day. Thats the way I look at them, but I don't know. I have been a construction worker all my life though and I wouldn't buy any of them.Completely unrealistic prices relative to tax base on your wages.No value at all as far as I can see. But a lot of people are buying this stuff.So the technicals tell me I am wrong thinking for now.Thats about all I see in charts.How wrong my thinking is all the time.lol
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Registered User
Joined: 10/7/2004
Posts: 111
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The problem I have with BOP is that the formula that is used to create it is proprietary and isn't released. Without knowing how an indicator is constructed, how can a person rely on it? Unfortunately, as much as I enjoy the Worden software, I don't use their proprietary indicators.
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Registered User
Joined: 12/30/2004
Posts: 9
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Balance of Power must have something to do with money flow differentials on up and down days. Money stream is money flow so volumne difference with money flow on an up day ratio to past down day, weeks, months etc. would give you trend.But the divergence of price to moneystream is wierd.Price may go up as in red as bop is in red.Volumne green for an up day in price.
Hurts my brain.What little there is of it.
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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One of the greatest things about BOP is the indicator's ability to contradict price. Imagine that BOP was red everytime price was down and green everytime price rose. Would you need BOP then? NO, you could just use price!
BOP is designed to uncover HIDDEN strength and weakness by diverging from price.
- Craig
Here to Help!
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Registered User
Joined: 10/10/2004
Posts: 22
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I have learned that one way of looking at BOP can be in terms of concerted accumulation/distribution of shares. I had glimpse at SYNA today and did see how BOP could be misleading - but I just had to look at what weekly ratings of BOP, TSV, and MS correlations were illustrating (Note: I just think that BOP/TSV/MS gives a lot of insight when viewed as weekly ratings):
1. 4 weeks of decreasing concerted accumulation of shares as evidenced by BOP;
2. 13 weeks of negative price facilitation as evidenced by TSV;
3. Bearish price action as evidenced within all time frames by MS.
This really gives a lot of weight when considering to buy or sell shares of SYNA.
I hope that this information, coupled with your own talents, leads you into a better trading perspective within the nearest future.
Lance
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