Balance Of Power (BOP)
(BOP is the exclusive intellectual property of Worden Brothers, Inc)
From the TeleChart2000
Help Topics: BOP
“BOP tells you whether the underlying action in the trading of a stock is characterized by systematic buying (accumulation) or systematic selling (distribution).”
“For scanning purposes,
. . .Green BOP represents values greater 30
. . .Yellow BOP represents values from 30 to -30
. . .Red BOP represents values less than -30.”
For this example,
Chart Editing Indicator Tab#
Middle or Bottom
. . .Balance of Power
. . . . .Moving Average – 10 bars – Simple;
. . . . . . . Drawing color White, Drawing style dotted
(BOP)
…Today’s BOP value
or
. . .Select <BOP Value Today-H> from the Main Screen WatchList’s Sort menu
(BOP.10)
…BOP value 10 days ago
(BOP>30)
…Today’s BOP value is greater than 30 (green)
(BOP<(-30))
…Today’s BOP value is less than – 30 (red)
(BOP>(-30))AND(BOP<30)
BR…Today’s BOP value is greater than -30 and less than 30 (yellow)
(BOP.10>(-30))AND(BOP.10<30)
…BOP value 10-days ago was greater than -30 and less than 30 (yellow)
MAX(BOP,10)
… Maximum BOP value over the last 10 days
MIN(BOP,10)
… Minimum BOP value over the last 10 days
AVG(BOP,10)
… Average BOP value over the last 10 days
(AVG(BOP.5,65))
…Average BOP value over the last 65 days, excluding the past 5 days
BOP
> 10-day average BOP value
BOP>AVG(BOP,10)
…Todays’ BOP value is above the average BOP value over the past 10 days
BOP <
10-day average BOP value
BOP<AVG(BOP,10)
…Todays’ BOP is below the average BOP value over the past 10 days
BOP DIVERGENCE
“A
divergence occurs when the trend of a security’s price doesn’t agree with
the trend of an indicator.”
http://www.equis.com/free/taaz/intindicators.html#divergences
For this example:
Chart Editing Indicator Tab# settings
Price – Line Chart; Drawing Color Green
. . . . Linear Regression – 10 bar period
Balance of Power
. . . . Linear Regression – 10 bar period
. . . . . . .(Drawing Color Cyan / Drawing Style Wide – works well for contrast)
Positive Divergence
. . .BOP Linear Regression Line trending upward from left to right
. . .Price Linear Regression line trending downward from left to right
BOP>=(MAX(BOP,10))AND(C<=MINC10)
Negative
Divergence
. . .BOP Linear Regression Line trending downward from left to right
. . .Price Linear Regression line trending upward from left to right
BOP<=(MIN(BOP,10))AND(C>=MAXC10)
For this example:
Screen Tab# Indicator settings
Daily Chart
Middle or Bottom
. . . Balance of Power – check Visible
. . . . Moving Average – 65 bars – Simple
Weekly Chart
Middle or Bottom
. . . Balance of Power – check Visible
. . . . Moving Average – 13 bars – Simple
CANSLIM
IBD Acc-Dis PCF
AVG(BOP,65)
In an EasyScan,
use the EasyScan Range Selector to
DETERMINE the Accumulation/Distribution Rating:
A or B rating means the stock is being accumulated
. . .A rating = Range Selector Rank (%) > 80
. . .B rating = Range Selector Rank (%) > 60 AND < 80
C rating indicates a neutral setting
. . . C rating = Range Selector Rank (%) > 40 AND < 60
D or E rating means the stock is being distributed (sold)
. . .D rating = Range Selector Rank (%) > 20 AND < 40
. . .E rating = Range Selector Rank (%) < 20
Strategy:
. . .Buy only those CANSLIM stocks which are rated A and B
For
additional information:
http://www.tradeon.com/tradeon/tc2000/index.html
. . . PCFs: BOP
. . .PCFs: Divergence
. . .Trading Systems: CANSLIM
http://www.equis.com/free/taaz/intindicators.html#divergences
http://www.equis.com/free/taaz/linearegression.html
http://www.tradingtactics.com/technical_analysis/Indicators/linear_regression_sl
ope.htm
See, also:
TeleChart 2000 Help Topics
. . .BOP
. . .Formula codes
. . . . .Max( ) and Min ( )
. . . . .Math Operators
. . . . . .Average AVG( )
. . .Linear Regression
TeleChart 2000 User’s Guide; p. 59, p. 61-64
TeleChart 2000 Daily Worden Report for 8/16/98
http://www.tc2000.com/
. .Special Reports: Interpreting Balance of Power (Parts One and Two)