Sometimes you get twins that are opposites of each other. The blond and the brunette. The smart one and the jock. The gang leader and the police detective.
In technical analysis, you have the Negative Volume Index and the Positive Volume Index.
Both of these indices represent indicators in technical analysis that relate price movements to relative volume levels on a given day. The NVI looks at days when the volume goes down. PVI looks at days when the volume goes up.
You buy 100 shares of AMZN at $1,867.23. The $1,867.23 figure is the price. The 100 shares gets counted as volume.
All those individual transactions get counted together to give every trading session a volume total. AMZN trades about 4.5 million shares on an average day. This means that, during a typical session, 4.5 million shares of AMZN traded hands in all the various transactions that took place.
You're a technical analyst looking at trading on Monday, Tuesday, and Wednesday of this week. Monday saw 4.5 million shares traded. Tuesday had a volume figure of 5.5 million. Wednesday had volume of 5 million. Tuesday was an up day in terms of volume. The figure of 5.5 million was higher than the previous day (Monday), when volume was only 4.5 million. Wednesday, meanwhile, gets counted as a down day. It's volume figure was down from the previous day (Tuesday in this case), dipping to 5 million from the prior session's 5.5 million.
So, in the PVI versus NVI consideration, Tuesday would get counted for the Positive Volume Index and Wednesday would get counted for the Negative Volume Index.
PVI and NVI each create a kind of trend line, relating price movements to volume. A technical trader can track changes in the PVI and NVI to help them predict how a stock will move in the future.
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Finance: What is a Chartist?26 Views
Finance allah shmoop What is a chartist Well here's a
chart and here's a chart and here's a chart All
right Well these are pages from the investing bible of
a chartist A chartist is an investor really a traitor
as they tend to own stocks for a much shorter
period of time than a longer term Really invest or
type person a chartist relies solely on the patterns The
pattern's right there These are all patterns imputed by the
charts that they you know sitting poor threw for hours
and hours So check out this chart see how the
plotted data closely follows the characteristic line there The characteristic
line basically is plodded through all those dots Yes So
they're going to stare at that try to figure out
where that line is going in the future right Get
the crystal ball or all right Well let's look at
this one where the data forms what looks like Well
the head and shoulders of someone who you know doesn't
have a neck that's Just common pattern in trading And
you know if you stopped looking at it and two
thirds of the way through there it's heading down Well
Maybe you'd be short the stock for a few days
and then you see it bottoming and then you'd be
long and try to make money that way Good luck
All right len look at this chart Where is right
here where the data appears to We'll break away from
the established pattern which was all just kind of boring
Lee along down here And then suddenly everything goes up
Yeah start doing its own thing Well maybe the company
reported a good quarter or ah you know the government
cut taxes again Everything went up So these were the
tools of the chartist The chart's a chartist is the
opposite of a fundamental investor meaning that she doesn't know
or care what the company does for a living Really
she doesn't care about their p e ratio nor their
profit margins nor their debt levels on their balance sheet
nor much of anything fundamental about how their business runs
Chartist just care about the pattern they glean from the
charts and all the charts always work until they don't
And what happens when the meteor hits that is that 00:02:06.0 --> [endTime] predictable on a chart Ah
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Technical analysts don't care how companies make their money or how they run their business; they're just interested in the numbers. The data. Yeah...