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Volume Based > TFS: Volume Oscillator

Article/Author: "How To Get In With The Trend And Out At The End", Bryan Strain, S&C Magazine, Traders Tips, 06/2000

Download: Tfs.ela

File Includes:

Indicator - Vol Osc Avg
Indicator - TFS: MBO Indicator
Indicator - Tether Line
Strategy - TFS Signal

Category: Indicator > Volume Based

Description:

This is the second part of TFS trading strategy. The concept of this indicator is similar to that of On-Balance Volume indicator (OBV).It is calculated according to these rules:

If Close > Open, Volume is positive
If Close < Open, Volume is negative
If Close = Open, Volume is neutral

Then you take the 7-day MA of the results.

Usage:

The indicator must be positive when the close crosses above the Tether line.




Inputs:

AvgLen - number of bars to calculate

EasyLanguage Code:
INPUT: AVGLEN(7);

VARIABLES: VOLACCUM(0), VOLOSC(0);

VOLACCUM = 0;

FOR VALUE1 = 0 TO AVGLEN -1 BEGIN
IF CLOSE[VALUE1] > OPEN[VALUE1] THEN
VOLACCUM = VOLACCUM + VOLUME[VALUE1];
IF CLOSE[VALUE1] < OPEN[VALUE1] THEN
VOLACCUM = VOLACCUM - VOLUME[VALUE1];
END;

VOLOSC = VOLACCUM / AVGLEN;

PLOT1(VOLOSC, "VOL OSC");
PLOT2(0, "ZEROLINE");