RE: [CANSLIM] U/D algorithm

From: "Katherine Malm" <kmalm@earthlink.net>
Subject: RE: [CANSLIM] U/D algorithm
Date: Thu, 16 Jan 2003 11:08:14 -0600

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Hi Eric,

The U/D ratio is very simple and so has it's peculiar drawbacks, among which
single big up or down days can distort the measure fairly easily. Like most
technical indicators, it's just a quick way of summarizing what you can see in
the Price/Volume action itself:

 U/D Definition: A 50-day ratio that is derived by dividing total volume on up
days by the total volume on down days. A ratio greater than 1.0 implies positive
demand for a stock.

My understanding of Chaikin Money Flow (and his associated Accum/Distribution
metric) is that it is much closer to IBD's A/D reading, as it looks at the
closes relative to the day's range to determine buying/selling pressure.

Katherine
  -----Original Message-----
  From: owner-canslim@lists.xmission.com
[mailto:owner-canslim@lists.xmission.com]On Behalf Of Eric Jaenike
  Sent: Thursday, January 16, 2003 10:42 AM
  To: canslim group
  Subject: [CANSLIM] U/D algorithm


  I've been comparing the U/D ratio used by IBD to Chaikin Money Flow. Does
anyone have any info on the algorithm for U/D, or whether its an open/closed
indicator, etc?

  Thanks,

  Eric





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<BODY>
<DIV><SPAN class=3D156395916-16012003>Hi Eric,</SPAN></DIV>
<DIV><SPAN class=3D156395916-16012003></SPAN>&nbsp;</DIV>
<DIV><SPAN class=3D156395916-16012003>The U/D ratio is very simple and =
so has it's=20
peculiar drawbacks, among which single big up or down days can distort =
the=20
measure fairly easily. Like most technical indicators, it's just a quick =
way of=20
summarizing what you can see in the Price/Volume action =
itself:</SPAN></DIV>
<DIV><SPAN class=3D156395916-16012003></SPAN>&nbsp;</DIV>
<DIV><SPAN class=3D156395916-16012003><FONT size=3D2>&nbsp;</FONT><FONT =
size=3D3>U/D=20
Definition: A 50-day ratio that is derived by dividing total volume on =
up days=20
by the total volume on down days. A ratio greater than 1.0 implies =
positive=20
demand for a stock.</FONT></SPAN></DIV>
<DIV><SPAN class=3D156395916-16012003></SPAN>&nbsp;</DIV>
<DIV><SPAN class=3D156395916-16012003>My understanding of Chaikin Money =
Flow (and=20
his associated Accum/Distribution metric) is that it is much closer to =
IBD's A/D=20
reading, as it looks at the closes relative to the day's range to =
determine=20
buying/selling pressure.</SPAN></DIV>
<DIV><SPAN class=3D156395916-16012003></SPAN>&nbsp;</DIV>
<DIV><SPAN class=3D156395916-16012003>Katherine</SPAN></DIV>
<BLOCKQUOTE>
  <DIV class=3DOutlookMessageHeader dir=3Dltr align=3Dleft><FONT =
face=3DTahoma=20
  size=3D2>-----Original Message-----<BR><B>From:</B>=20
  owner-canslim@lists.xmission.com=20
  [mailto:owner-canslim@lists.xmission.com]<B>On Behalf Of </B>Eric=20
  Jaenike<BR><B>Sent:</B> Thursday, January 16, 2003 10:42 =
AM<BR><B>To:</B>=20
  canslim group<BR><B>Subject:</B> [CANSLIM] U/D =
algorithm<BR><BR></FONT></DIV>
  <P>I've been comparing the U/D ratio used by IBD to Chaikin Money =
Flow. Does=20
  anyone have any info on the algorithm for U/D, or whether its an =
open/closed=20
  indicator, etc?</P>
  <P>Thanks,</P>
  <P>Eric</P>
  <P><BR>
  <HR SIZE=3D1>
  Do you Yahoo!?<BR><A=20
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href=3D"http://rd.yahoo.com/mail/mailsig/*http://mailplus.yahoo.com">Yaho=
o! Mail=20
  Plus</A> - Powerful. Affordable. <A=20
  =
href=3D"http://rd.yahoo.com/mail/mailsig/*http://mailplus.yahoo.com">Sign=
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