Twiggs Money Flow

[STRAT]

Here is the VPE chart for one year. This is one I have followed close ( at least weekly, usually daily )

Can anyone explain to me the obvious divergence between OBV and Twiggs money Flow. Is one right and the other wrong or are they telling us different things?

[Phaedrus]

Strat, there are many different Volume indicators. Here are 6, plus of course the simplest one of all, a volume histogram. They each have their strengths, weaknesses and characteristics and their interpretation differs a little. None are "right" or "wrong" and while they each aim to depict roughly the same thing, they have taken different approaches, their formulae are different.

Here (http://www.incrediblecharts.com/indicators/twiggs_money_flow.php) is a link to a discussion of some of these differences. You might find it helpful.

http://h1.ripway.com/78963/VPE815.gif

[STRAT]

Thanks Phaedrus.

Have read those pages more than once including the formulas although not to the point of trying to analyse the formulas other than to notice that the formulas are perhaps overly simplistic ( and need to be ). Over the last year or so I have chopped and changed indicators, applying them to the same set of stocks. I didnt expect to be still be this unsure which are the best but Im not surprised. If any one performed better in all circumstances I guess everyone would use it there by making it somewhat impotent.

Clearly OBV has worked better in this example and has given a similar perspective to the state of VPE as my own analysis through volume, trend lines, ma and candles. I always start with these 4.

[evilroyrule]

good morning, i am well and truly our of my depth in these forums, but have read most of the posts from your two in recent weeks and would appreciate your thoughts. By nothing other than sheer luck i have made good returns off npx, fpa, air, aia in recent months. i also hold some gpt and apt. i see people are saying this is a bear market rally and wld be interested in your thoughts? i was thinking of pulling the pin on these stocks in a month and putting them into minerals/oil on the asx. i know its not a great idea to put all in one basket but the other option of into the bank doesnt really appeal! thanks for your time

[STRAT]

Hi Evil Roy,
What is it you rule?:D

Welcome to the boards.

First up. Luck it may well be. Everyone has done well over the last few months. I would suggest that no body will answer that question regarding selling your NZ stocks and buying in those sectors on the ASX. You will have to make that decision on your own but dont invest what you cannot afford to loose because sooner of later you will loose.

There are some clever and kind people here but you will need to be more specific with your questions and you wont find a magic crystal ball. You will have to put in the hours.

Last, but by no means least if by "your two" you mean "you two" and if by "you two" you mean Phaedrus and myself please be well aware of the fact that Phaedrus has more useful information in the little toe on his left foot than I have in my head. I am very much a junior here. Dont make the mistake of assuming more posts means more smarts.;)

[evilroyrule]

thank you for your reply. i wasnt chasing an answer rather some thoughts. perhaps i will stick to reading the posts rather than creating one. thanks again

[STRAT]

thank you for your reply. i wasnt chasing an answer rather some thoughts. perhaps i will stick to reading the posts rather than creating one. thanks againI didnt mean to put you off Roy.:o More specific questions will get more specific answers. Get into it boots and all with learning and posting.

Here are a few things to consider.
What tools /knowledge do you already have that you can lend to playing this game?
Do you like the idea of TA or FA as a base or style?
Re ASX stocks you mentioned
Is the oil sector looking strong?
Which minerals are are leading in the current rally and will they continue to do so.
Which minerals are lagging behind and why? Will they catch up?

[airedale]

Hi Strat, perhaps you could ask Colin Twiggs for his thoughts on this subject. I am sure that he will consider the subject logically.

Off topic: Les Paul, a great inventive guitarist, sadly missed. Loved his multi track recordings with Mary Ford and others.

[Phaedrus]

I have made good returns off npx, fpa, air, aia in recent months. i also hold some gpt and apt. i was thinking of pulling the pin on these stocks in a month Why sell when they are all in good uptrends? Who knows how far they will run. Why "in a month", come to that. The time to sell each of these stocks is when their uptrends weaken or end - not on some completely arbitrary "target" date.
Closely monitor all your holdings using trend indicators. Start with trendlines, moving averages and perhaps Trailing Stops. Sell when they tell you to, rather than when you feel like pulling the pin!



You could ask Colin Twiggs for his thoughts on this subject. That link was Colin Twiggs' thoughts on the subject.



Over the last year or so I have chopped and changed indicators..... I didnt expect to still be this unsure which are the best..Ah, the search for the Holy Grail. The perfect indicator. Failing that, the "best" indicator. There isn't one, Strat. I spent (wasted) years looking.


For my own analysis I always start with these 4 - volume, trend lines, ma and candles. Excellent. That's a really good selection. You could perhaps look into adding an oscillator such as RSI (an oldie but a goody) and DMI is an excellent "standalone" trend indicator system. IMO no system is complete without a Stochastic oscillator. These can add real insight into market dynamics. These indicators would comprise a small but comprehensive toolkit. Add as many extra indicators as you like, but the quality of your decisions will not necessarily be any better. Don't waste time worrying too much about which volume indicator to use. It's not that big a deal. My personal preference is for the OBV. As a crude, simple man of limited intelligence, I am naturally drawn to the simplest, crudest, most easily understood volume indicator. This is not to say that I consider it the "best"!

[STRAT]

Excellent. That's a really good selection. You could perhaps look into adding an oscillator such as RSI (an oldie but a goody) and DMI is an excellent "standalone" trend indicator system. IMO no system is complete without a Stochastic oscillator. These can add real insight into market dynamics. These indicators would comprise a small but comprehensive toolkit. Add as many extra indicators as you like, but the quality of your decisions will not necessarily be any better. Don't waste time worrying too much about which volume indicator to use. It's not that big a deal. My personal preference is for the OBV. As a crude, simple man of limited intelligence, I am naturally drawn to the simplest, crudest, most easily understood volume indicator. This is not to say that I consider it the "best"!Thats reasuring :D

Talking of revolving indicators RSI and OBV are my only two keepers thus far. Not sure whether OBV is a keeper because it agrees with my basic analisis ( agrees with me haha) more often than the others or because you put me onto it in the first place but a keeper for sure.

Thanks Phaedrus.

PS pragmatic, Im sure but simple? I dont think so :cool:

[STRAT]

Hi Strat, perhaps you could ask Colin Twiggs for his thoughts on this subject. I am sure that he will consider the subject logically.

Off topic: Les Paul, a great inventive guitarist, sadly missed. Loved his multi track recordings with Mary Ford and others.Hi Airedale, I might do that. I believe He has a forum on his site.
The Lez Paul guitar is a wonderful instrument. Sad hes gone but he had a decent innings