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  • Signal generation using Volume Price Confirmation Indicator (VPCI) with Plots and Highlight Breaches’

    Developed by Buff Dormeier, VPCI won 2007 Charles H Dow award by the MTA. VPCI plots the relationship between price trend and the volume, as either being in a state of confirmation or contradiction.

    Excerpt from article below:

    “Fundamentally, the VPCI reveals the proportional imbalances between price trends and volume-adjusted price
    trends. An uptrend with increasing volume is a market characterized by greed supported by the fuel needed to
    grow. An uptrend without volume is complacent and reveals greed deprived of the fuel needed to sustain itself.
    Investors without the influx of other investors (volume) will eventually lose interest and the uptrend should
    eventually breakdown.

    A falling price trend reveals a market driven by fear. A falling price trend without volume reveals apathy, fear
    without increasing energy. Unlike greed, fear is self-sustaining, and may endure for long time periods without
    increasing fuel or energy. Adding energy to fear can be likened to adding fuel to a fire and is generally bearish
    until the VPCI reverses. In such cases, weak-minded investor’s, overcome by fear, are becoming irrationally
    fearful until the selling climax reaches a state of maximum homogeneity. At this point, ownership held by weak
    investor’s has been purged, producing a type of heat death capitulation. These occurrences may be visualized by
    the VPCI falling below the lower standard deviation of a Bollinger Band of the VPCI, and then rising above the
    lower band, and forming a ‘V’ bottom. ”


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