Thursday, May 20, 2010
Tip #2 KVO
Stephen J. Klinger developed the Klinger Volume Oscillator indicator, which uses volume to measure the accumulation or distribution of shares in order to determine the long-term trends of money flow while remaining sensitive to short-term fluctuations.
1. In the case of an up-trend, a buy signal is generated when the KVO crosses its trigger line (the 13-day KVO exponential moving average) from below after a big drop below the zero level.
2. In the case of a down-trend, a sell signal is generated when the KVO crosses its trigger line from above after reaching unusual high levels above zero.
3. When the Klinger Volume Oscillator indicator starts increasing but the underlying symbol is decreasing, the underlying symbol price is likely to start increasing. (Positive Divergence).
4. When the Klinger Volume Oscillator indicator starts decreasing but the underlying symbol is increasing, the underlying symbol price is likely to start decreasing. (Negative Divergence).
One can follow the 1 minute TZA chart and watch the KVO to initiate buys and sells. (see disclaimer above) 8" Hubley Racer No. 1
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