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Registered User
Joined: 3/24/2005
Posts: 4
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I'm a Gold subscriber, running Telechart Ver 6.0.0053 on a Win XP platform.
I'm having a great deal of confusion about Relative Strength. My comparison symbol is SP-500. For this discussion I'll use FCX and CL as the example equities (updated to 9/25/07) and RS is relative to the SP-500.
Using the "sort by" right click feature in Telechart, if I sort the Russell 1000 component stocks by RS (daily time frame), highest at the top, FCX ranks 93rd. Alternatively, if I resort the Russell 1000 by Price Percent Change Today, then FCX ranks 923rd from the top. There is a huge difference in the ranking of FCX between it's percentage change and its RS. This is the root of my confusion. I don't see why there should be a difference in sorting by percentage change, or RS if they are both the same time frame (daily). FCX changed -2.32% this day, but has a higher RS ranking than CL (ranked 94th) which changed +1.48%.
How can this possibly be, that a stock that fell has a higher daily Relative Strength than a stock that rose?
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Worden Trainer
Joined: 10/7/2004
Posts: 65,138
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Relative Strength is the Ratio of the Active Symbol Price to the Comparison Symbol Price. If the RS line is ascending, then the active symbol is out-performing the comparison symbol. If the RS line is descending, the active symbol is under-performing the comparison symbol.
When you use Indicator Sorts on Relative Strength you have two options, Visual Value and Visual Change. Both would be relative to the range of Relative Strength over the period for the particular Time Frame and Zoom being used.
Neither will have Ranks corresponding to either Price Percent Change Today or the Price Percent Change over the period covered for the particular Time Frame and Zoom being used. Price Percent Change is calculated using only the endpoints of the period being covered and does not take into account the range of Prices over the entire period.
-Bruce
Personal Criteria Formulas
TC2000 Support Articles
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Registered User
Joined: 3/24/2005
Posts: 4
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Thanks Bruce. I'm sorting by RS visual value. Where you say percent change "does not take into account the range of Prices over the entire period.", does this mean that RS will be evaluated for the entire period I see on my screen? I'm using a daily chart, zoom = 5, so my graph time range is from 5/8/07 to now. Am I understanding correctly, that RS is evaluated over that whole time period since 5/8/07, and if I change the zoom or time frame it will change the RS rank?
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Worden Trainer
Joined: 10/7/2004
Posts: 65,138
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Yes the Relative Strength Rank will change.
Visual Value represents where Relative Strength is compared to the entire range of Relative Strength for the visible portion of the chart. So if the current Relative Strength is at the top of the chart it will be 100% and if it is at the bottom of the chart it will 0%.
Visual Change represents the difference in the Visual Value over the Visual Change Period.
-Bruce
Personal Criteria Formulas
TC2000 Support Articles
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