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> BOP = BALANCE OF POWER, Money flow indicator
mss
post Feb 13 2007, 10:07 AM
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BOP = BALANCE OF POWER, a measure of money flow based on price. Also referred to as BMP, balance market power. It is useful in forecasting direction changes based on the daily price action of the Index or stock you are following. When the calculations yields the "raw number" then any SMA or EMA may be applied. Crossovers of two MAs' are sometimes useful. Short term 13&21, IT 21&34, LT single 89, 144 ids' trends well.

VERY REFINED: USE THE FOLLOWING CALCULATIONS: (FOR EXCEL)
BULL-OPEN=(HIGH-OPEN)/(HIGH-LOW)
BEAR-OPEN=(OPEN-LOW)/(HIGH-LOW)
BULL-CLOSE=(CLOSE-LOW)/(HIGH-LOW)
BEAR-CLOSE=(HIGH-CLOSE)/(HIGH-LOW)
BULL-O/C=IF CLOSE>OPEN,(CLOSE-OPEN)/(HIGH-LOW),IF NOT,0
BEAR-O/C=IF OPEN>CLOSE,(OPEN-CLOSE)/(HIGH-LOW),IF NOT,0
RAW POWER=(BULL OPEN+BULL CLOSE+BULL O/C)/3
MINUS (BEAR OPEN+BEAR CLOSE+BEAR O/C)/3

SPREADSHEET TAKE-OFF
BULL-OPEN =(D2-C2)/(D2-E2)

BEAR-OPEN=(C2-E2)/(D2-E2)

BULL-CLOSE=(F2-E2)/(D2-E2)

BEAR-CLOSE=(D2-F2)/(D2-E2)

BULL-OC=IF(F2>C2,(F2-C2)/(D2-E2),0)

BEAR-OC=IF(C2>F2,(C2-F2)/(D2-E2),0)

RAW POWER=(G2+I2+K2)/3-(H2+J2+L2)/3

C=OPEN G=BULL-OPEN
D=HIGH H=BEAR-OPEN
E=LOW I =BULL-CLO
F=CLOSE J=BEAR-CLO
K=BULL-O/C
L=BEAR-O/C
M=RAW POWER

SIMPLE VERSION: TRADERS' TIPS, AUGUST 2001, STOCKS & COMMODITIES MAG.
This balance of market power indicator discussed this month by Igor Livshin breaks down to nothing more than:

(CL - OP)/(HI - LO)= BOP

regardless of whether the CL is greater than OP. When you plug in the variables and break it down to its simplest form, you get:
Change / Range = BOP or BMP


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