I look at this indicator along with 5 bar vol surge to find relative strenght stocks that are getting increased volume.  But I am not sure what the "market" reference is for the indicator - If I plot it against the SPY as a proxy for the "market" it is much more variable than I would expect.  Can you educate me on what is the reference "market" or tell me how to create a custom indicator that is similar where I can pick the "market" (perhaps the SPY or perhaps the Industry Group, or perhaps a specific sector ETF).

Thk

Price Trend vs Market

These criteria are calculated by Morningstar.

Step 1 : Do the following summations

Sum for every full-data, non-BBS stock, on the NYSE and AMEX , that has been trading for at least 200 days :

Market value for each of the last 30 trade days, using latest shares for market value

Volume traded for each of the last 30 trade days

Step 2 : Compute 30-Day Price Trend to Market, for each stock as :

Set Base Value = Total market value 29 days ago, computed in step 1 above.

Set up a table of 30 values for X and Y :

Sum for 30 occurrences :

Sum (Y)

Sum (X * Y)

If Stock close 29 days ago = zero, or Sum (Y) = zero, or Sum (X*Y) = zero,

Set 30-Day Trend to Market = NC

Else

Compute 30-Day Trend to Market = ( Sum (X * Y) * 600 ) / ( Sum (Y) * 899 )

Step 3 : Compute 5-Day Price Trend to Market, for each stock as :

Set Base Value = Total market value 29 days ago, computed in step 1 above.

Set up a table of 5 values for X and Y :

Sum for 5 occurrences :

Sum (Y)

Sum (X * Y)

If Stock close 5 days ago = zero, or Sum (Y) = zero, or Sum (X*Y) = zero,

Set 5-Day Trend to Market = NC

Else

Compute 5-Day Trend to Market = ( Sum (X * Y) * 50 ) / Sum (Y)

Step 4 : Compute 30-Day and 5-Day Volume Trend to Market, for each stock, using the same methodology as in steps 2 and 3, but setting up Base Value and Y as :

Base Value = Total Volume 29 days ago, computed in step 1 above.

Y = ( Stock Volume each day * Base Value ) /

Total Volume for that day, from step 1