Score:
The closer the price is to the floor of the trend channel, and the higher the quality of the trend channel, the higher the score. A recent strong price drop, such that RSI is low, also contributes to a higher score. A positive volume balance and a strong correlation between volume tops and price tops also is positive. Sell signals from formations and close to resistance levels decrease score.
Buying price:
Is set to the floor of the trend channel and a little above (about 15% of the trend height).
Price target:
Is set to the ceiling of the trend channel and a little below (about 20% of the trend height).
NOTE FROM TN: VIDERE FORKLARING HER PAA NORSK SKJOENNTE JEG IKKE NOE AV
We have chosen to use the level of the ceiling the day after, instead of calculating the price level of the ceiling after the indicated time horizon. WE do this because the price, especially when the trend is nearing its end, often not goes all the way up to the ceiling of the trend. Often the ceiling of the day after will be at the middle or floor of the trend after the indicated time horizon.
Stop loss:
Is set just below the bottom of the trend channel.
Time horizon:
Based on statistics from 1996-2004 and the stock's volatility characteristics, a time horizon is calculated for how many days it will take on average to complete a price movement equal to the movement from buying price to price target.
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The content provided by Investtech.com is NOT SEC or FSA regulated and is therefore not intended for US or UK consumers.
Investtech guarantees neither the entirety nor accuracy of the analyses. Any consequent exposure related to the advice / signals which emerge in the analyses is completely and entirely at the investors own expense and risk. Investtech is not responsible for any loss, either directly or indirectly, which arises as a result of the use of Investtechs analyses. Details of any arising conflicts of interest will always appear in the investment recommendations. Further information about Investtechs analyses can be found here disclaimer.
The content provided by Investtech.com is NOT SEC or FSA regulated and is therefore not intended for US or UK consumers.