IngoPan
09-16-2008, 09:23 AM
A lot of people are asking me a lot of questions regarding the ominous "ratio" i am using.
I will try to explain what the ratio is and why we offer a live / realtime chart of it here at sentiment-traders.com .
a) What is ADVN/DECL ratio ?
Its the ratio u get when u divide the US advancers stocks / the US decliners stocks. If i talk about US stocks
i mean the stocks cumulated from all three major US markets = AMEX,NASDAQ & NYSE.
b) Is it any useful ?
For my personal trading, it definately is since i can determine in what "mood" the market is at every minute of the actual trading day.
When i talk about "mood" i am referring to whether we have more sellers or more buyers in market. This also includes a neutral market when the
markets participants are in equilibrium and thus provide a lustless market with not much volatility.
c) How can i use it and make advantage of it and does the ratio give exact entry/exit points ?
No, thats not the intented way. Imagine: You know what the majority of the market participants is doing right at this minute.
Assuming you see a ratio of 2.8. From such a high ratio you can conclude that the mood is bullish and that the market is likely to go higher.
In this case, why would you want to short the higher high/lower high instead of buying the lower low/higher low as risk/reward clearly favors the long side ?
Below are the values we found to be valid over years now:
very bullish: 3.0-4.5
bullish: 1.5-3.0
neutral: 0.6-1.5
bearish: 0.2-0.6
very bearish: 0.2-0.1
d) Where can i access the ratio live chart ?
At http://ratio.sentiment-traders.com you can access the "ADVDELCR" chart.
Make sure you are using latest FireFox browser with latest flash plugin installed.
It´s updating every 10 secs, Monday-Friday from 9:30 AM - 4 PM EST.
e) Is this service free of charge ?
Yes, its completely free.
I will try to explain what the ratio is and why we offer a live / realtime chart of it here at sentiment-traders.com .
a) What is ADVN/DECL ratio ?
Its the ratio u get when u divide the US advancers stocks / the US decliners stocks. If i talk about US stocks
i mean the stocks cumulated from all three major US markets = AMEX,NASDAQ & NYSE.
b) Is it any useful ?
For my personal trading, it definately is since i can determine in what "mood" the market is at every minute of the actual trading day.
When i talk about "mood" i am referring to whether we have more sellers or more buyers in market. This also includes a neutral market when the
markets participants are in equilibrium and thus provide a lustless market with not much volatility.
c) How can i use it and make advantage of it and does the ratio give exact entry/exit points ?
No, thats not the intented way. Imagine: You know what the majority of the market participants is doing right at this minute.
Assuming you see a ratio of 2.8. From such a high ratio you can conclude that the mood is bullish and that the market is likely to go higher.
In this case, why would you want to short the higher high/lower high instead of buying the lower low/higher low as risk/reward clearly favors the long side ?
Below are the values we found to be valid over years now:
very bullish: 3.0-4.5
bullish: 1.5-3.0
neutral: 0.6-1.5
bearish: 0.2-0.6
very bearish: 0.2-0.1
d) Where can i access the ratio live chart ?
At http://ratio.sentiment-traders.com you can access the "ADVDELCR" chart.
Make sure you are using latest FireFox browser with latest flash plugin installed.
It´s updating every 10 secs, Monday-Friday from 9:30 AM - 4 PM EST.
e) Is this service free of charge ?
Yes, its completely free.