Indicadores: Elder Force Index (faithful to the book definition)

 

Elder Force Index (faithful to the book definition):

Force Index as Alexander Elder defined it: Volume x (Close today - Close yesterday), and the resulting series is THEN smoothed. Two lengths, 2 and 13, both from his books. The order of operations is the point. This computes MA[ Volume x (Close - PrevClose) ]: the raw force per bar first, the average applied to that series after. Applying an average to price first and multiplying by volume afterwards gives a different series that does not converge to this one. If you compare implementations and the values differ, this is why. Real volume with automatic fallback to tick volume, and the source actually used is written in the subwindow name. Elder's usage: trend up and the 2-period EMA drops below zero is a buy signal; trend down and it rallies above zero is a sell. The trend filter is deliberately not included - his signals are conditional on trend direction. No performance claim is made: a faithful implementation of a published formula, not a trading system.

Elder Force Index (faithful to the book definition)

Autor: Joao Prata Silva Yglesias