[RT] Market Volume Equity Chart

[Pete Lieber <plieber@xxxxxxxxxxxxxx>]

Today the S&P finished up and my volume indicator closed lower than the previous day.  In determining the effectiveness of the volume indicator I applied it in a system using daily S&P/volume indicator divergence as a signal - buy on the next day open and selling at the close if previous day the S&P closed down and the indicator up and shorting on the next day open and covering at the close if previous day the S&P closed up and the indicator down.  Since 1988 this system gained 1123.64 S&P points (see attached equity chart) while the S&P500 advanced only 834.08 points.  Ok, Ok, I know the equity chart is not ideal having gained most of its points over two time periods.  However, one of those time periods is the present when the volume indicator is weighed most closely to the S&P weighting.  BTW, taking the signal and buying/shorting on the open and closing the trade the following day produced 1222.38 S&P points but the equity line looks even worse.

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Attachment: S&P Volume Indicator Equity Chart.gif
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