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Stable (TM) Technical Graphs Version 2.0 Shareware Reference Guide May 1994 WINTERRA (TM) Software Group P.O.Box 4106 Highlands Ranch, CO 80126 Voice/Fax: (303) 470-6323 Electronic Mail: CompuServe - 70244,2371 Internet - 70244.2371@compuserve.com ii Copyright (c) 1990-1994 by WINTERRA (TM) Software Group All Rights Reserved Software Components SHELL.DLL, DDEML.DLL, CTL3D.DLL Copyright (c) 1991-1992 by Microsoft Corp. No part of this manual may be reproduced or transmitted in any form or by any means or for any purpose without the express written permission of WINTERRA Software Group. Information in this document is subject to change without notice and does not represent a commitment by WINTERRA Software Group. The software described in this document is furnished under a license agreement. It is against the law to copy this software under any circumstances except as provided by the stated license agreement found herein. Trademarks WINTERRA and Stable are trademarks of WINTERRA Software Group. Microsoft is a registered trademark of Microsoft Corporation. Windows is a trademark of Microsoft Corporation. Quicken is a registered trademark of Intuit, Inc. CompuServe is a registered trademark of CompuServe Incorporated. Dow Jones is a registered trademark of Dow Jones & Company, Inc. MetaStock is a trademark of EQUIS International. iii ****************** IMPORTANT WARRANTY INFORMATION ***************** Stable Technical Graphs Version 2.0 *** PLEASE READ THIS INFORMATION CAREFULLY *** ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ TRIAL USE (SHAREWARE EVALUATION VERSION) WARRANTY: -------------------------------------------------- The Shareware evaluation (trial use) version of Stable Technical Graphs is provided "AS IS". WINTERRA (TM) Software Group makes no warranties of any kind, expressed or implied, that this program is error free or that any supplied data or other program information is accurate or complete. No representation or warranties are made as to the completeness, accuracy, or precision of this program. ALL WARRANTIES (INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE) ARE EXPRESSLY EXCLUDED. THIS SOFTWARE AND ALL PROGRAM FILES ARE PROVIDED "AS IS" AND THE USER MUST ASSUME THE ENTIRE RISK OF USING THIS PROGRAM. REGISTERED VERSION ONLY WARRANTY: --------------------------------- WINTERRA Software Group warrants the physical diskette(s) and physical documentation provided with registered versions to be free of defects in materials and workmanship for a period of ninety days from the date of registration. If WINTERRA Software Group receives notification within the warranty period of defects in materials or workmanship, and such notification is determined by WINTERRA Software Group to be correct, WINTERRA Software Group will replace the defective diskette(s) or documentation. ALL WARRANTIES (INCLUDING ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE) ARE EXPRESSLY EXCLUDED. THIS SOFTWARE AND ALL PROGRAM FILES ARE PROVIDED "AS IS" AND THE USER MUST ASSUME THE ENTIRE RISK OF USING THIS PROGRAM. The entire and exclusive liability and remedy for breach of this Limited Warranty shall be limited to the replacement of defective diskette(s) or documentation and shall not include or extend to any claim for or right to recover any other damages, including but not limited to, loss of profits or other trading losses incurred as a result of any decision or action taken on your part based upon information provided, implied, or suggested by this product, loss of data, or use of the software, or special, incidental, or consequential damages or other similar claims, even if WINTERRA Software Group has been specifically advised of the possibility of such damages. In no event will WINTERRA Software Group's liability for any damages to you or any other person ever exceed the lower of the suggested list price or actual price paid for the license to use the software, regardless of any form of the claim. iv _______ ____|__ | (R) --| | |------------------- | ____|__ | Association of | | |_| Shareware |__| o | Professionals -----| | |--------------------- |___|___| MEMBER Association of Shareware Professionals Ombudsman Statement This program is produced by a member of the Association of Shareware Professionals (ASP). ASP wants to make sure that the shareware principle works for you. If you are unable to resolve a shareware- related problem with an ASP member by contacting the member directly, ASP may be able to help. The ASP Ombudsman can help you resolve a dispute or problem with an ASP member, but does not provide technical support for members' products. Please write to the ASP Ombudsman at 545 Grover Road, Muskegon, MI 49442-9427 or send a CompuServe message via CompuServe Mail to ASP Ombudsman 70007,3536. NOTE This "Shareware Evaluation" copy of Stable Technical Graphs is a completely functional program and all program functions have been documented. This is not a "demo" program. v CONTENTS -------- Chapter 1 Introduction 1.1 What Is Stable Investment Software? ...............1-1 1.2 Features ..........................................1-2 1.3 Distribution Files ................................1-3 1.4 Installing Stable and System Requirements .........1-4 1.5 If Stable Won't Run ...............................1-5 1.6 Backup Your Files .................................1-5 Chapter 2 Registration 2.1 Software License Agreement ........................2-1 2.2 Registration Form .................................2-2 Chapter 3 Keyboard Interface 3.1 Stable Keys .......................................3-1 Chapter 4 Commands 4.1 File Menu Commands ................................4-1 4.2 Configure Menu Commands ...........................4-1 4.3 Options Menu Commands .............................4-2 4.4 Graph Menu Commands ...............................4-3 4.5 Select Menu Commands ..............................4-3 4.6 Window Menu .......................................4-4 Chapter 5 Procedures 5.1 Adding/Removing Additional Graphs on a Chart ......5-1 5.2 Adding New Attachments ............................5-1 5.3 Adjusting Chart and Graph Sizes ...................5-2 5.4 Automatic Price Graph Labeling ....................5-3 5.5 Changing a Graph's Drawing Style ..................5-4 5.6 Changing Graph Colors (and Horizontal Grids) ......5-4 5.7 Changing and Removing Attachments .................5-4 5.8 Displaying Graph Data .............................5-5 5.9 Displaying Moving Averages on a Graph .............5-6 5.10 Displaying a Price Channel ........................5-6 5.11 Drag and Drop .....................................5-7 5.12 Dynamic Data Exchange (DDE) ......................5-7 5.13 Exporting Chart Data To An ASCII Data File ........5-8 5.14 Printing Charts ...................................5-9 5.15 Scrolling Through a Graph .........................5-9 5.16 Selecting a Graph .................................5-10 5.17 Selecting a Printer and Options ...................5-10 5.18 Setting the Number of Horizontal Grids ............5-10 5.19 Popup Graph Menu ..................................5-11 5.20 The "Slide" .......................................5-11 5.21 Opening Financial Charts ..........................5-11 5.22 Formatting the Printed Page .......................5-12 5.23 Financial Chart Groups ............................5-12 5.24 Chart Options .....................................5-13 5.25 File Import Options ...............................5-14 5.26 Font Options ......................................5-15 5.27 Graph Color Options ...............................5-15 vi CONTENTS (Cont'd) ----------------- Chapter 6 Data Files 6.1 ASCII Data Files ..................................6-1 6.2 General Format ....................................6-2 6.3 Examples ..........................................6-3 6.4 Historical Data Suppliers .........................6-5 Chapter 7 Dynamic Data Exchange 7.1 Programmer's Reference ............................7-1 7.1.1 Application (Service) Name .................7-1 7.1.2 Topics .....................................7-2 7.1.3 DDE Request Transactions ...................7-2 7.1.4 DDE Execute Transactions ...................7-4 7.1.5 DDE Poke Transaction .......................7-6 7.2 Stable DDE Communications with Excel ..............7-6 7.2.1 Open HRB Macro .............................7-7 7.2.2 Poke HRB Macro .............................7-7 7.2.3 Show HRB Macro .............................7-8 7.2.4 Supported =EXECUTE() Commands ..............7-8 Chapter 8 Technical Indicators 8.1 Moving Averages ...................................8-2 8.2 Negative/Positive Volume Indexes (NVI/PVI) ........8-3 8.3 On-Balance Volume .................................8-3 8.4 Oscillators (Price and Volume) ....................8-3 8.5 Price Channel (Trading Band) ......................8-4 8.6 Price Momentum ....................................8-4 8.7 Rate of Change (Price and Volume) .................8-5 8.8 Volume ............................................8-5 8.9 Negative/Positive Volume Trend (NVT/PVT) ..........8-5 8.10 Weighted Close ....................................8-5 8.11 Commodity Channel Index (CCI) .....................8-6 8.12 Moving Average Convergence/Divergence (MACD) ......8-6 8.13 Open Interest .....................................8-6 8.14 Relative Strength .................................8-7 8.15 Relative Strength Indicator (RSI) .................8-7 8.16 Stochastic ........................................8-8 8.17 Performance .......................................8-8 8.18 Point & Figure ....................................8-8 Chapter 1 Introduction 1.1 What Is Stable Investment Software? ---------------------------------------- Stable (TM) Investment Software is planned as an integrated set of programs seeking to provide both experienced and novice investors and traders with useful software tools focusing on the study of the financial markets. It is the goal of WINTERRA Software Group to provide useful, easy to use programs, beneficial in meeting your day to day investment needs. It is hoped that you, as an interested and/or experienced user of market related software, will provide comments and suggestions assisting us in meeting this goal. You are encouraged to let us know what you think of the product - and what features and/or functionality are important to you. This software program - Technical Graphs - addresses one specific area of financial market investing; the analysis and study of market movement and direction through the interpretation of technically- oriented graphs. Stable Technical Graphs can be used to graph data associated with individual stocks, mutual funds, commodities, interest rates, major stock and bond indexes (i.e., Dow Jones, Standard & Poor's, Lehman Brothers, etc.) - essentially any data that has (at a minimum) a date and price value associated with it. Introduction 1-2 1.2 Features ------------- Stable Technical Graphs v2.0 is a financial technical analysis application for Microsoft Windows 3.1 and above, and contains many of your most requested features. Written for experienced and novice users alike, Stable provides powerful - yet easy to use - stock market technical analysis capabilities ideal for the technical trader with existing (or access to) historical financial data for stocks, bonds, commodities, mutual funds, indexes, and options. Combining popular technical indicators with features such as DDE (Dynamic Data Exchange), chart printing, selectable graph styles, new data import/export formats, popup graph menus, enhanced desktop management features, and more - Stable Technical Graphs is likely to become an indispensible tool in your Windows financial tools arsenal. Stable Technical Graphs reads TC2000, CSI, Technical Tools, MetaStock, and ASCII data files; allowing you to use your existing data more effectively. All Stable charts support selectable zoom and horizontal scrolling - giving you the ability to study as many as 16,384 units (days, weeks, etc.) of data in a single graph. And when you identify a chart worthy of more attention, simply print it to your system printer. All Stable Technical Graphs charts provide an easy to use "slider" for accurately comparing a specific day's activity across several graphs. Also available is an application "toolbar" providing single mouse click operation of frequently used charting operations and tools. Exciting new features found in this latest version of Stable Technical Graphs include the following: o Financial groups can be created for organizing and collecting any number of individual charts into a common group o Multi-data charts can be created for analyzing several underlying securities in the same chart. o Interactive chart drawing tools; including trend lines, speed resistance lines, and text attachments can be drawn and saved with any chart. o All charts are scalable along the X and Y axis - and include chart zoom and selectable area functionality. As many as 16,384 days of data are supported for each and every chart. o New indicators have been added including Point & Figure, Stochastic, and Performance graphs. o Chart data can be exported to various ASCII file formats; including the price history format used to import into Quicken(TM). Introduction 1-3 o Improved desktop chart management has been provided using the standard Microsoft Windows Multiple Document Interface (MDI). o Up to 8 technical analysis indicators can be created on each chart. Other standard features found in Stable Technical Graphs include the following: o Dynamic Data Exchange (DDE) support has been built in - allowing you to communicate directly with any Stable chart through the use of third-party software (such as Microsoft Excel) to open, print, display - or to dynamically add new data to a chart. o "Drag and Drop" support is available - allowing CSV and Technical Tools data files to be opened simply by "dragging" a file from the File Manager directly to the Stable application window or icon. o User-selectable graph styles; including High/Low Bar, Line, and Histogram graphs. o Popup menu support within any graph allowing you to quickly perform many common graph functions. o On-line help documentation using the standard Window's Help program. o All chart and graph colors are easily selected and changed to suit your own personal preference. 1.3 Distribution Files ----------------------- The following files are included as part of the Stable Technical Graphs shareware distribution package: STABLE.EXE Stable Technical Graphs Windows Program File STABLE.HLP Stable Technical Graphs Windows Help File STABLE.TXT Stable Technical Graphs User Reference Manual STABLE.XLM Excel macro sheet demonstrating DDE features STABLE.INI Stable Technical Graphs Initialization File DJ30.CSV Sample ASCII data - Dow Jones Industrials HRB.CSV Sample ASCII data - H&R Block DDEML.DLL Required DLL for Dynamic Data Exchange support SHELL.DLL Required DLL for Drag and Drop support CTL3D.DLL Required DLL for Dialog appearance FILE_ID.DIZ Description for BBS systems. VENDINFO.DIZ ASP Product Information File README.TXT Important last-minute information. REGISTER.TXT Registration information and order form. PACKING.LST Shareware distribution file list. VENDOR.TXT Information and restrictions for disk vendors, DESCRIBE.TXT Sample descriptions for catalogs, BBSs, etc. LICENSE.TXT Important License and Usage Information SITELICE.TXT Site License Information and Agreement. Please take the time to read the above files (at least those that pertain to you as a individual user, vendor, or sysop). Introduction 1-4 1.4 Installing Stable and System Requirements ---------------------------------------------- Stable Technical Graphs is a Microsoft Windows application and requires the following minimum configuration for operation: - Microsoft Windows version 3.1 and above. - 4MB RAM memory - VGA Display (640 x 480) or larger - System pointing device (i.e., mouse, trackball, etc.) - System printer (optional for printing charts) Stable Technical Graphs requires only four program files to run (not including any of the data files which you will graph): - STABLE.EXE - STABLE.HLP - DDEML.DLL - SHELL.DLL - CTL3D.DLL When executing Stable v2.0, all of the above files MUST BE available at runtime; either from the current directory or a directory found in your AUTOEXEC.BAT "PATH=" statement. The data files that have been provided with the product allow you to immediately use the program in your own environment. While these (and other) data files can be placed in any directory, you may want to at least keep all of the Stable distribution files together within the same directory. If you have a compressed copy of the Stable Technical Graphs package (ie, STABLE.ZIP, STABLE.ARC, STABLE.LHZ), the simplest installation procedure is: 1. Create a new subdirectory on your system called \STABLE. 2. Copy the compressed Stable distribution file to this new directory. 3. Decompress the Stable file using the appropriate decompression program (PKUNZIP.EXE for .ZIP file, PKXARC.EXE for .ARC, etc.) 4 Reboot your system. If you have received the Stable Technical Graphs package as the complete set of uncompressed individual files listed in Section 1.3 "Distribution Files", perform the same steps as above with the exception of step 3). As a final step to installation, you should consider removing the file named STABLE.INI from your Windows directory if you have a previous version of Stable installed. In order to support many of the enhanced features of Stable v2.0, several changes have been made to the file's syntax. Introduction 1-5 If you delete the STABLE.INI file, you will have to save any chart configuration information once again. If you do not delete the file, Stable will still operate, however, it will not recognize any previously save configuration information anyway. 1.5 If Stable Won't Run ------------------------ If you try and run Stable Technical Graphs and encounter a Windows error message similar to either of the following... CANNOT FIND DDEML.DLL, PLEASE INSERT IN DRIVE A: CANNOT FIND SHELL.DLL, PLEASE INSERT IN DRIVE A: ...this indicates an invalid installation of Stable on your computer. If you installed all the Stable distribution files into a single directory, then all you need to do is include the directory name in your PATH statement - AND REBOOT YOUR COMPUTER. Any changes made to your AUTOEXEC.BAT file will not become effective until after a system restart. 1.6 Backup Your Files ---------------------- Before you actually begin using Stable Technical Graphs, it is strongly suggested that you at least perform the following task: !BACKUP YOUR STABLE DISTRIBUTION FILES OR DISKETTE! Accidents do happen! While there may not be any way to prevent the loss of your program, you can take action now to help avoid the problem of being without it in the future. Making a backup copy now is insurance that you won't have to be without Stable Technical Graphs when you need it. Chapter 2 Registration SITE LICENSES are available. The file SITELICE.TXT contains site license pricing information and a site license agreement. 2.1 Software License Agreement ------------------------------- Stable Investment Software - Technical Graphs is a copyrighted product protected by copyright law. You are authorized to use this copy of Stable Technical Graphs for a period of 30 days for your own personal evaluation. You may also distribute copies of this evaluation version to friends and associates - so long as all conditions identified in the LICENSE.TXT text file are met. User Groups, Computer Clubs, Disk Vendors and Distributors, Subscription Services, Disk-of-the-Month Clubs, etc., should refer to the VENDOR.TXT file for complete information relating to them. BBS SYSOPs should refer to the SYSOP.TXT file for complete information relating to them. To become a licensed user of Stable Technical Graphs, simply fill out and return the supplied registration form along with your registration payment. The registration form can be found on Page 2-3, or you can use the form found in the file REGISTER.TXT. As a licensed user, you will: o Receive the latest version of Stable Technical Graphs. o Receive a comprehensive User's Manual for the product. o Receive minor updates to the program as they become available - INCLUDING all new technical indicators added to the product. o Be notified of all new major product releases. As a licensed user you will be offered major version releases at a substantially reduced and favorable rate. o Receive technical support by phone, mail, or electronic mail via CompuServe. o Be eligible to participate in any "beta testing" programs associated with future releases of the product. Registration 2-2 2.2 Registration Form ---------------------- To purchase a licensed version of Stable Technical Graphs, please return this registration form along with your check, postal money order (drawn on U.S. FUNDS ONLY please), or credit card information and mail to: WINTERRA Software Group P.O.Box 4106 Highlands Ranch, CO 80126 Voice/Fax: (303) 470-6323 The pricing for Stable Technical Graphs is forty-nine dollars and ninety-five cents ($49.95) for a single user license. This price includes any applicable Colorado sales tax. Site licenses are also available - see the file SITELICE.TXT for detailed information. ------------------------------------------------------------------- Name: __________________________________________________________ Company: __________________________________________________________ Address: __________________________________________________________ City: ____________________________ State: ______ Zip: ________ Phone: (______)____________________ Fax: (______)_______________ Date: __________________ CompuServe ID: _______________________ Format: [__] 3 1/2" 720-KB [__] 5 1/4" 360-KB Quantity: [__] Stable Technical Graphs @$49.95 $____________ Shipping/Handling/Customs [__] U.S. @$ 4.00 $____________ [__] Canada/Mexico @$ 6.00 $____________ [__] International @$12.00 $____________ TOTAL $____________ =================================================================== Method of Payment: [___] Check [___] Credit Card Credit Card Information: [___] Visa [___] Mastercard Card Number: ___________________________________ Name on Card: ___________________________________ Expiration Date: ___________________________________ Signature: ___________________________________ =================================================================== COMMENT FORM ------------ We would like you to participate in helping to define the direction of the Stable Technical Graphs product. What is important to you? What isn't? Please take a moment to fill out and return this form. Interest(s) of Study: [ ] Stocks [ ] Indexes [ ] Commodities [ ] Bonds [ ] Mutual Funds [ ] Options [ ] Other _________________________________________________________ Technical Indicators (currently use or would like to see): [ ] Accumulation/Distribution [ ] Price Performance [ ] Chaikin Oscillator [ ] Volume Trends (PVT/NVT) [ ] Commodity Channel Index (CCI) [ ] Relative Strength Index [ ] Correlation Analysis [ ] Standard Deviation [ ] Demand Index [ ] Stochastic Oscillator [ ] Directional Movement [ ] Swing Index [ ] Fourier Analysis [ ] TRIX (Triple Exp Smoothing) [ ] Herrick Payoff [ ] Volatility (Chaikin) [ ] Moving Average Acc/Dist (MACD) [ ] Volatility (Wilder) [ ] Median Price [ ] Volume [ ] Negative/Positive Volume Index [ ] Volume Oscillator [ ] On-Balance Volume [ ] Volume Momentum (ROC) [ ] Parabolic SAR [ ] Weighted Close [ ] Price Momentum (Rate of Change) [ ] Williams (Acc\Dist, %R) [ ] Other _________________________________________________________ Charts (currently use or would like to see): [ ] High/Low Bar and Line Charts [ ] Candlestick Charts [ ] Point and Figure Charts Other Tools (currently use or would like to see): [ ] Fibonacci Based Tools [ ] Profitability Testing [ ] Options Related Tools [ ] Chart Scaling and Zoom [ ] Indicator Optimizations [ ] Custom Formulas/Indicators [ ] Data Downloading General Comments: ___________________________________________________________________ ___________________________________________________________________ ___________________________________________________________________ ___________________________________________________________________ Chapter 3 Keyboard Interface 3.1 Stable Keys ---------------- The following describes specific keys that are available while running Stable Technical Graphs program. Key(s) Function ---------------- -------------------------------------------------- F1 Displays the Help window. Ctrl+O Selects a new chart. Ctrl+D Show/Hide the data display. Ctrl+A Displays the "Attachments" dialog box. Ctrl+P Displays the "Parameters" dialog box. Ctrl+I Displays the "Indicators" dialog box. Ctrl+Z Toggles the zoom mode for the active chart. Ctrl+Left Arrow Moves the chart's slide to the left. Ctrl+Right Arrow Moves the chart's slide to the right. Tab Changes the active graph within a chart. Shift+Tab Changes the active graph within a chart Home Scrolls to the first page of security information. End Scrolls to the last page of security information. PgUp Scrolls back a page of security data. PgDn Scrolls forward a page of security data. Up Arrow Scrolls back a "line" of security data. Down Arrow Scrolls forward a "line" of security data. The following key sequences are used when drawing lines or placing text onto a graph. Key(s) Function ---------------- -------------------------------------------------- Shift+Left Button Selects a graph area to zoom. Ctrl Key Pressed Holding down the Ctrl key while drawing either freehand or speed resistance lines will extend the line to the edge of the graph. Chapter 4 Commands 4.1 File Menu Commands ----------------------- The File menu includes functions for opening and closing charts, exporting chart data, and printing a chart. Open Chart... Opens a securities chart using existing financial data in one of the supported file formats. Close Chart Closes the active chart, removing it from the current group. Export Chart Data... Exports the active chart's price data in various ASCII file formats, including the price import format used by Quicken. Page Setup... Allows you to select or set page specific information related to the printing of a chart. Printer Setup... Allows you to select and configure the printer that you want to use for printing your securities charts. Print Chart... Prints the active chart to the printer. Exit Exits Stable Technical Graphs. 4.2 Group Menu Commands ------------------------ Stable Technical Graphs provides a feature for organizing and collecting a number of individual charts into a common group. These financial groups can contain almost any collection of one or more securities meeting your specific analysis needs. For example, a group might contain a collection of market indexes. Another group might contain all the securities in your portfolio, while another might include mutual funds of a particular sector group. The choice of securities is totally up to you. Commands 4-2 The Group menu includes functions used specifically for security groups. New Create a new group. Open... Open a previously saved securities group. Save Save the current group. Save As... Save the current group as a new group name. Print All Charts... Print all charts contained within the group. 4.3 Tools Menu Commands ------------------------ The Tools menu includes functions used for drawing lines and text to a graph. Normal Reset the current drawing mode to normal. Auto Line Extension Enables or disables the automatic extension of lines drawn on a chart. If this selection is checked, lines are automatically extended to the edge of the graph. Select Select an area of the graph to zoom into. Text... Draw text onto a chart. Trend Line Draw a free-hand trendline on the graph. Vertical Line Draw a vertical line at a specific location on a graph. Horizontal Line Draw a horizontal line at a specific location on a graph. Speed Resistance Draw speed resistance lines between two points on a graph. Commands 4-3 4.4 Options Menu Commands -------------------------- The Options menu includes functions for configuring Stable Technical Graphs. Chart Allows you to specify various characteristics associated with securities charts; including text display, scrolling limits, chart grid lines, and Point & Figure marker size. File Import Allows you to specify the number of most recent financial data units used when opening a chart, and identifying the default ASCII data formats for files lacking the standard header. Fonts Use this function to select the style of fonts you want to use for chart labeling, data display, and the status bar. Graph Allows you to select the default colors and number of grids used for new charts. 4.5 Graph Menu Commands ------------------------ The Graph menu includes selections that control the appearance of a graph; including the type of graph, parameters specific to the graph, the graph's colors, and if the graph should display its data. Display Data Toggles the data display window on or off. Attachments... Allows the editing and removal of existing graph attachments. Parameters... Allows you to change graph-specific data parameters. The availability of this selection is dependent upon the current graph. Not all graphs will support this option. The Price Graph allows you to control the display of moving averages and a Price Channel on the Price Graph. High/Low Bar Line Histogram These menu selections allow you to change the appearance of the currently selected graph. The availability of each option is dependent upon the type of graph. Commands 4-4 Zoom In Zoom Out Toggle between the display of all chart data, and the display of a fixed amount of data (scrollable). Indicators... Allows you to select an indicator from a list of available Indicator Graphs. Specific items in the list are dependent upon the data content of the security. For example, if volume data is not available for the security, a Volume Graph will not be available as an Indicator Graph selection. 4.6 Window Menu Commands ------------------------- The Window menu provides functions for managing the display of all charts in a group. Cascade Displays all charts as cascading windows. Tile Vertical Displays all charts as vertically tiled windows. Tile Horizontal Displays all charts as horizontally tiled windows. Arrange Icons Arranges the display of all minimized charts. Close All Closes (removes) all charts from the group. Chapter 5 Procedures This chapter describes those procedures that are most commonly used in Stable Technical Graphs. Note that adding or modifying attachments can only be performed when the chart is displaying all of its data within the window. 5.1 Adding/Removing Technical Indicators ----------------------------------------- You can have as many as eight (8) technical indicators on each chart for analyzing and studying the underlying financial data. To add or remove technical indicators: 1. Select the graph by clicking within the graph, or by "tabbing" to the graph. 2. Select Indicators... from the Graph Menu. -OR- Click on the Ind button at the lower right corner of the chart. 3. In the Technical Indicators dialog, add indicators from the list on the left - or remove indicators from the list on the right. 4. Click the OK button to accept your changes. 5.2 Adding New Attachments --------------------------- Attachments are graphical elements such as lines and text which you place on a graph. To add an attachment, perform the following procedures. To add an attachment: 1. Select the attachment you want to add from the Tools menu. -OR- Click the desired attachment button on the toolbar. 2. Move the mouse to the location on the graph where you want to place the attachment. The mouse cursor appearance changes to the selected attachment type. Once the above steps have been performed, various actions occur depending on your selected attachment type: Text attachment: 3. Click the left mouse button to drop the attachment onto the graph. 4. Enter the text and select the colors, alignment, and other styles from the available options - then press the OK button. Procedures 5-2 Trend line attachment: 3. Click and hold the left mouse button to anchor the first endpoint, then move the mouse to the location where you want the second endpoint to be. 4. Release the left mouse button to complete the trend line. Tip: Holding the Ctrl key down during the above procedure will extend the line beyond the second endpoint to the edge of the graph. Vertical and horizontal line attachment: 3. Click the left mouse button to draw the vertical or horizontal line. The line is drawn to the edges of the graph. Speed resistance line attachment: 3. Click and hold the left mouse button to anchor the first endpoint, then move the mouse to the location where you want the second endpoint to be. 4. Release the left mouse button to complete the speed resistance line. Two lines originating from the "earlier" endpoint are drawn, each representing the 1/3 and 2/3 speed resistance points. Tip: Holding the Ctrl key down during the above procedure will extend the lines beyond the second endpoint to the edge of the graph. Additional Notes: o Trend and speed resistance line extension can be performed either by holding the Ctrl key down while drawing the line, or by selecting Auto Line Extension from the Tool menu before selecting the attachment type. o The color and style of all lines can be selected prior to drawing from the color and style combo boxes found in the program's toolbar. 5.3 Adjusting Chart and Graph Sizes ------------------------------------ As more charts are added to a financial group, you may want to change the size of the charts to accommodate the optimal viewing of each chart. When new technical indicator graphs are placed within a chart, the size of the price graph changes to make room for these additional graphs. To adjust the size and location of charts: Charts are effectively standard windows that support the normal window management techniques found in the Microsoft Windows environment. Procedures 5-3 You can resize any chart window by clicking on the border of the window and dragging the sizing rectangle until the desired size is set. You can reposition a window by clicking on the window's title and dragging the window to a new location. Additionally, you can perform standard tiling and cascading of financial chart windows by choosing the appropriate selection from the Window menu. To interactively change the size of the Price Graph (only when one or more technical indicators are visible): 1. Move the mouse to the location between the Price Graph and the first technical indicator graph until the mouse cursor changes to a double vertical arrow. 2. Press and hold down the left mouse button. 3. Move the mouse vertically to set the new bottom of the Price Graph. As you move the mouse, a horizontal line is drawn to identify the new bottom of the Price Graph. 4. Release the mouse to set the new Price Graph size. 5.4 Automatic Price Graph Labeling ----------------------------------- Stable provides the option of automatically labeling your Price graphs. When this option is selected, Stable determines the available space on the Price graph and automatically generates horizontal grids and labels that optimally fit within this space. To select automatic labeling for your Stable charts: 1. Select Chart... from the Options menu. 2. Check the box labeled "Automatic Price Graph Labeling". To use normal text labeling on your Stable charts: 1. Select Chart... from the Options menu. 2. Clear the box labeled "Automatic Price Graph Labeling". Procedures 5-4 5.5 Changing a Graph's Drawing Style ------------------------------------- The drawing style for a graph can be changed so that you can interpret the data more easily. Stable supports three basic drawing styles; a High/Low Bar graph, a Line graph, and a Histogram. The High/Low Bar style is available only for the Price graph. To change the drawing style for a graph: 1. Select the graph by clicking within the graph, or by "tabbing" to the graph. 2. Select High/Low Bar, Line, or Histogram from the Graph menu on the chart. -OR- Activate the popup graph menuproc_popupgrf and select High/Low Bar, Line, or Histogram from the menu. 5.6 Changing Graph Colors (and Horizontal Grids) ------------------------------------------------- You can change the colors (and the number of horizontal grids) for any graph displayed in a chart. To change a graph's colors: 1. Select the graph by clicking within the graph, or by "tabbing" to the graph. 2. Choose Parameters... from the Graph menu. -OR- Activate the popup graph menuproc_popupgrf and select Parameters... from the menu. 5.7 Changing and Removing Attachments -------------------------------------- Attachments are graphical elements such as lines and text which you place on a graph. To remove or make changes to an attachment, perform the following steps. To access the list of all attachments on a graph: 1. Select Attachments... from the Graph menu. -OR- Click the right mouse button on the graph and select Attachments... from the popup menu. 2. Choose Delete or Edit... to remove or change the attachment. To change the location of an attachment: 1. Click and hold the left mouse button over the attachment and drag it to the new location. Procedures 5-5 To delete an attachment: Option 1 1. Select Attachments... from the Graph menu. -OR- Click the right mouse button on the graph and select Attachments... from the popup menu. 2. Select the attachment from the list and choose the Delete button. Option 2 1. Double-click on the attachment in the graph. 2. Choose Delete from the displayed dialog to remove the attachment. To change the color or style of an attachment: Option 1 1. Select Attachments... from the Graph menu. -OR- Click the right mouse button on the graph and select Attachments... from the popup menu. 2. Select the attachment from the list and choose the Edit... button. Option 2 1. Double-click on the attachment in the graph. 2. Make changes to the information in the displayed dialog and choose the Ok button. 5.8 Displaying Graph Data -------------------------- For any graph displayed in a chart, you can choose to have the graph display the underlying data on which it is based. One "day" of data is displayed based on the current position of the slide. To display the data associated with a graph: 1. Select the graph by clicking within the graph, or by "tabbing" to the graph. 2. Select Display Data from the Graph Menu on the chart. -OR- Press CTRL+D on the keyboard. -OR- Activate the popup graph menuproc_popupgrf and select Data Display from the menu. Procedures 5-6 5.9 Displaying Moving Averages on a Graph ------------------------------------------ As many as three (3) individual moving averages can be displayed on a price or indicator graph. In addition to specifying the number of units for these averages, the type of average (Simple, Weighted, or Exponential), any shift factors, and its color can be indicated. To select and specify a moving average: 1. Select the graph by clicking within the graph, or by "tabbing" to the graph. 2. Select Parameters... from the Graph Menu on the chart. -OR- Press CTRL+P on the keyboard. -OR- Activate the popup graph menuproc_popupgrf and select Parameters... from the menu. To remove a moving average: * Set the number of units to zero (0) for the specific average. 5.10 Displaying a Price Channel -------------------------------- A price channel can be displayed on a graph along with moving averages. In addition to specifying the number of units for the channel, the type of average (Simple, Weighted, or Exponential), the shift factors, and its color can be specified. To select and specify a price channel: 1. Select the graph by clicking within the graph, or by "tabbing" to the graph. 2. Select Parameters... from the Graph menu on the chart. -OR- Press CTRL+P on the keyboard. -OR- Activate the popup graph menuproc_popupgrf and select Parameters... from the menu. To remove the price channel: * Set the number of units to zero (0) for the price channel. Procedures 5-7 5.11 Drag and Drop ------------------- Stable charts can be opened using "Drag and Drop". By simply selecting a file from the File Manager, and "dragging" that file using the mouse into the Stable window or icon, you can easily create new charts without the need to interact with the Open Chart dialog. Stable supports "Drag and Drop" using two types of historical data files; CSV and Technical Tools data files. Any other data file format is ignored by Stable. Refer to your Windows 3.1 documentation for more information on the Drag and Drop facility of Windows 3.1. 5.12 Dynamic Data Exchange (DDE) --------------------------------- Stable Technical Graphs functions as a DDE server application; responding to client applications by providing technical graph services in the areas of chart display management and real-time data update. In the area of display management, Stable Technical Graphs provides basic control over the creation and display of technical charts: o Charts can be opened or created by a DDE client application through the use of execute transactions issued to Stable as the "SYSTEM" topic. o The Stable window can be controlled using DDE execute transactions. Supported commands allow the window to be minimized, shown (normal), and closed. o Individual charts can be controlled visually through DDE execute transactions. Among the supported command actions are minimize, maximize, print, show, close, update, and export. Real-time data update of Stable charts is also supported. By passing ASCII data record information conforming to the underlying security's content, new financial data can be submitted to a Stable chart for immediate update and display. For further details about DDE functionality provided by Stable, refer to the Stable Reference Guide, Stable User's Guide. Procedures 5-8 5.13 Exporting Chart Data To An ASCII Data File ------------------------------------------------ Once a chart has been opened, the underlying financial data (i.e., volume, close, etc.) used to draw the chart can be saved as an ASCII data file. This allows you to share the data with other third-party products such as Quicken(tm), various spreadsheet programs, and even other technical analysis applications. This feature also provides a way of converting financial data in one format (i.e., MetaStock, CSI, etc.) to an ASCII file. To export the active chart's financial data: 1. Choose Export Chart Data from the File Menu. 2. Specify the name of an output ASCII data file. 3. Select other export options from the dialog. 4. Select Export New or Export Append to write the ASCII data. To export the chart's price data to a file that can be imported into Quicken: 1. Enter a file name in the File Name box (or choose Browse to search for an existing file). 2. Select Quicken Historical as the export format. 3. Enter the symbol id (i.e., IBM, HRB, etc.) matching the id used in your Quicken database. 4. Select a data export range. 5. Choose Export New to create a new file, or Export Append to add the data to the end of an existing ASCII file. To export the chart's price data to an ASCII file that can be used by Stable: 1. Enter a file name in the File Name box (or choose Browse to search for an existing file). 2. Select CSV (ASCII) as the export format. 3. Verify or change the data format to match your new file's requirements. If you are creating a file to be used by Stable Technical Graphs, you should accept the displayed default (Supported Data Formatsgen_formats). 4. Check the box for Include Format Header. 5. Select a data export range. 6. Choose Export New to create a new file. Procedures 5-9 5.14 Printing Charts --------------------- You can print individual or every financial chart in a group from Stable Technical Graphs. All printing is performed in a "fit to page" mode - where the chart is printed to fill the entire printed page within your specified margins. To print an individual financial chart: 1. Choose Print... from the File menu. -OR- Click on the Print button in the toolbar. To print all charts in a financial group: 1. Select Print All Charts... from the File menu. 5.15 Scrolling Through a Graph ------------------------------- In some instances you will find that the securities data you are displaying extends beyond the left and/or right borders of your graph. You can gain access to all of the data using the scroll bar displayed at the bottom of the chart window, or by using the navigation keys supported by Stable Technical Graphs. To scroll forward through your graph data: * Click the right arrow on the scroll bar, or press the Down Arrow key, to move forwards your selected "arrow" distance. * Click the page right area of the scroll bar, or press the PgDn key, to move forward by your selected "page" distance. * Press the End key to move to the last page of data. To scroll backwards through your graph data: * Click the left arrow on the scroll bar, or press the Up Arrow key, to move backwards your selected "arrow" distance. * Click the page left area of the scroll bar, or press the PgDn key, to move backwards your selected "page" distance. * Press the Home key to display the first page of data. To scroll to any location within your graph data: * Drag the scroll bar's thumb horizontally along the scroll bar and position the date text for the desired time range, then release the mouse. Procedures 5-10 5.16 Selecting a Graph ----------------------- You can select a graph as the active graph in a chart for the purpose of changing its display characteristics; including the display of its underlying data, the type of chart, its colors, and any other indicator-specific parameters. To select a graph within a chart: 1. Click anywhere within the graph's border; including its display area and label. -OR- Press Tab or SHIFT+Tab to sequence through all the graphs in a chart. 5.17 Selecting a Printer and Options ------------------------------------- You can select any attached printer to print your securities charts and also select options specific to the printer. To change printers and/or specify printer options: 1. Choose Printer Setup... from the File menu. 2. Select the printer you want to use for printing. 3. Choose Options... to change the printer's options. 4. Select OK to save the new settings. 5.18 Setting the Number of Horizontal Grids -------------------------------------------- You can specify the number of horizontal grids displayed on a graph. For every displayed grid line, a corresponding value is shown in the label area of the graph. If Automatic Price Graph Labeling has been selected in Chart Options, the number of horizontal grids will automatically be determined and this value ignored. To change the default number of horizontal grids for all new charts: 1. Choose Options Graph Price set the default number of horizontal grids displayed on all new Price and Indicator Graphs. To change the number of horizontal grids for a displayed graph: 1. Select the graph by clicking within the graph, or by "tabbing" to the graph. 2. Choose Parameters... from the Graph Menu. -OR- Press CTRL+P on the keyboard. -OR- Activate the popup graph menuproc_popupgrf and select Parameters... from the menu. Procedures 5-11 5.19 Popup Graph Menu ---------------------- Stable provides a method by which you can even more effectively use your technical charts. This method allows you to access some of the more frequently used graph functions while you concentrate your attention directly on the graph. To take advantage of the popup menu support: 1. Move the mouse within any visible graph and click and hold the right mouse button. 2. Make a selection from the popup menu by selecting an item, then releasing the right button. 5.20 The "Slide" ----------------- The slide (which is positioned at the top of each chart) is used for focusing on a particular day on a chart. "Attached" to the slide is a vertical line or hair that provides a mechanism for precise vertical alignment across all graphs displayed on the chart. As you move the slide horizontally, the hair will follow and all data display areas will be updated with the actual graph data for that day. To move the slide horizontally: 1. Press CTRL+Left Arrow or CTRL+Right Arrow on the keyboard. -OR- Press and hold down the mouse button over the slide, and move the mouse horizontally from side to side. 5.21 Opening Financial Charts ------------------------------ Financial charts are created from existing financial data. Stable Technical Graphs does not provide functionality for creating financial data files. To create or open a new chart: 1. Select Open Chart... from the File menu. -OR- Click on the Open Chart button in the toolbar. 2. Choose one of the supported Import File Types and navigate through your system directories to the directory containing the financial data for your selected type. 3. Select the security name or data file from the File Name list box and click the OK button. -OR- Double-click on the security name or data file listed in the File Name list box. Procedures 5-12 5.22 Formatting the Printed Page --------------------------------- You can specify the margins used for printing a financial chart as well as a standard title you want to print on each chart. To specify a chart title and page margins: 1. Select Page Setup... from the File menu. 2. Enter the report heading you want printed on each financial chart (Optional). 3. Enter the top, bottom, left, and right margin values in inches for the chart. 4. Click OK to save your new settings. 5.23 Financial Chart Groups ---------------------------- Stable Technical Graphs provides a feature for organizing and collecting a number of individual charts into a common group. These financial groups can contain almost any collection of one or more securities meeting your specific analysis needs. For example, a group might contain a collection of market indexes. Another group might contain all the securities in your portfolio, while another might include mutual funds of a particular sector group. The choice of securities is totally up to you. To create a new financial group: 1. Select New from the Group menu -OR- Click on the New Group button in the toolbar. 2. Add new charts to your group by opening each chart using the Open Chart... selection on the File menu or clicking the Open Chart button on the toolbar. 3. Organize the charts in the group by adjusting the sizes and positions of each chart. Include any technical indicators with each chart. List of Technical Indicatorsgen_techlist 4. Save your new group by selecting Save or Save As... from the Group menu (or by clicking the Save button on the toolbar). 5. Enter a descriptive name for your new group and choose the OK button to save the information. Procedures 5-13 To open an existing financial group: 1. Select Open from the Group menu -OR- Click on the Open Group button in the toolbar. 2. Select an existing group to open by choosing a name from the Group List and clicking the OK button. -OR- Double-click on the name of the group in the Group List box. To delete an existing financial group: 1. Select Open from the Group menu -OR- Click on the Open Group button in the toolbar. 2. Select an existing group to open by choosing a name from the Group List. 3. Click the Delete button to remove the group. To change which charts are in the financial group: 1. Simply open or delete existing charts from the display, and then save the group by selecting Save or Save As... from the Group menu - or click the Save Group button on the toolbar. 5.24 Chart Options ------------------- Many of the operational characteristics associated with Stable charts can be configured to meet your own needs and preferences. Among the configurable items available to you are: - The display of labeling text as 3D or flat, with an option for raised or recessed text. - Automatic labeling of price graphs. - The display and use of vertical scroll bars on your charts. - Allow color printing. - The distances associated with chart scrolling. - The inclusion/exclusion of horizontal and vertical grids - as well as the line style used to display them. - The maximum display width of marker characters used in Point & Figure graphs. To modify any of the available chart options: 1. Select Chart... from the Options menu. 2. Modify or choose from the various configuration options. 3. Choose OK to save the new settings. Procedures 5-14 5.25 File Import Options ------------------------- Stable Technical Graphs allows you to specify the number of most recent data units you want graphed in each of your charts, as well as providing a mechanism for importing ASCII files that do not conform to the normal Stable ASCII file specification. Selecting the number of recent data units used in your charts: The amount of data loaded into Windows memory for all charts is configurable to meet your own personal analysis needs, or to address any specific memory constraints or problems you might encounter when running the Stable Technical Analysis program. When Stable Technical Graphs opens a chart, it loads the most recent data up to a selected number of units. The number of units is specified by you and can range from 2 up to 16,384. To specify the number of graph units: 1. Select File Import... from the Options menu. 2. Indicate the maximum number of data units you want each graph to contain by entering a value from 2 to 16,384 in the edit box labeled Most Recent Data Units. 3. Choose OK to save your selection. Any chart opened after this change is made will contain a maximum of the number you specified. Support for Non-Standard ASCII File Formats: Stable Technical Graphs supports the reading of some ASCII data files that do not conform to its normal format - such as those used by other third-party analysis programs or some spreadsheet applications. Normally, these ASCII files do not contain the Data Format record specified by Stable as the first record in an ASCII file. Through File Import Options, you can specify default ASCII file formats which Stable will assume when it encounters a file which does not contain the normal data format record. To specify default file formats: 1. Select File Import... from the Options menu. 2. Enter the default file format definitions you want Stable to assume for ASCII files containing 2, 3, 4, 5, 6, and 7 fields. 3. Choose OK to save your selections. Procedures 5-15 5.26 Font Options ------------------ You can select the font styles used by Stable Technical Graphs for chart labels, data display, and the status bar located at the bottom of the program window. This feature allows you to optimize your chart's appearance based on the resolution of your display. To select a font style: 1. Select Font... from the Options menu. 2. The currently selected font styles are displayed for each appearance selection type. Choose the appearance type to change by clicking on its descriptive button. 3. Select the font style from the Font dialog and choose the OK button to accept the new setting. 4. Choose the OK button of the Font Options dialog to redisplay using your new font choices. 5.27 Graph Color Options ------------------------- You can select the default colors (and the number of manual horizontal grids) used when a chart is opened by selecting Graph... from the Options menu. To select the default graph colors: 1. Select Price... or Indicators... from the Graph selection on the Options menu. 2. Select the background, foreground, and grid colors. If you are not using the automatic labeling feature, enter the number of horizontal grids you want for your default graphs. Tip: The automatic chart labeling feature should normally be used. 3. Choose the OK button to save your selected settings. Chapter 6 Data Files Stable Technical Graphs can read and chart existing historical stock market data supplied by you in any of the following formats: o TeleChart 2000 (TC2000) o Technical Tools o Commodity Systems, Inc. (CSI) o MetaStock o ASCII (comma-separated value CSV) 6.1 ASCII Data Files --------------------- Stable Technical Graphs can read data files containing "flat" ASCII information - where each record in the file consists of ASCII data terminated by a carriage return/linefeed combination. Each record in the file consists of multiple fields separated by either a comma (",") or tab character. White space may freely be interspersed within the data file. Stable Technical Graphs itself does not provide facilities for retrieving or creating the data files that you will graph. However, ASCII files can be created or generated in a variety of ways: o Downloading of financial information from online databases such as Dow Jones News Retrieval and CompuServe. Once retrieved, this data must usually be editted by you to conform to this ASCII file format. o Exporting of data from spreadsheet programs such as Microsoft Excel or Lotus 1,2,3. For example, if you are using Excel, simply save your securities data in ".CSV" (comma-separated values) format with the necessary header information identified in this section. Read your specific product documentation on how to save and/or export spreadsheet files. o Manually using a text editor that can create ASCII file information. This method would be described as the manual method of creating data - where you enter the data printed in your local newspaper or business journal. Almost any type of data can be graphed using Stable Technical Graphs, so long as each line of data contains at least a date and a closing value. The closing value can represent any numeric value; such as the daily close for a stock or mutual fund, the prime rate for that day, or the closing Dow Jones Industrial Average. Stable Technical Graphs reads and interprets ASCII numeric values found in your data files in a variety of formats: o Floating point decimal values (i.e., 34.65) for data related to such items as market indexes (i.e., DJIA, SP500), mutual funds, and various currency information. Data Files 6-2 o Standard fractional values (i.e., 64 1/8, 20 1/2) for representing data specific to stocks, options, and corporate bonds. o Special fractional values (i.e., 76:18) for data representing 1/32ths; such as Government Agency Issues (ie. FNMA, GNMA, World Bank) and Treasury Bonds, Notes and Bills. 6.2 General ASCII Format ------------------------ The general format of all ASCII data files that Stable Technical Graphs can interpret is as follows: <Format_String> <--- Optional for Stable v2.0 and above Data_Record_1 Data_Record_2 - - Data_Record_N <Record_Count> is the number of actual data records in the file (excluding the <Record_Count> and <Format_String> records). <Format_String> is a description of the format of each data record in the file. This string consists of the characters "DVOHLCI" which specifies both the sequence and type of data fields in each record: D represents a Date field This entry can be either 'D' for daily data, 'W' for weekly data, 'Q' for quarterly data, 'M' for monthly data, or 'Y' for yearly data. Additionally, a modifier character can follow the 'D' entry to identify a specific date format as identified below: 0 = mm/dd/yy (also the default if '0' is omitted) 1 = mmddyy 2 = yy/mm/dd 3 = yymmdd 4 = dd/mm/yy 5 = ddmmyy 9 = Serialized (Lotus-style) V represents a Volume field (or short interest). O represents an Open field. H represents a High field. L represents a Low field. C represents a Close field. I represents an Open Interest field. Data Files 6-3 Data_Record_n represents each ASCII record in the file, up to <Record_Count> entries. All data records must be of the same field sequence and contain identical types of fields. THE FOLLOWING NOTES APPLY TO ALL DATA IMPORTED BY STABLE: o No numeric values (ie. volume, open, close, etc.) may be formatted with a comma (e.g. Use 12900 instead of 12,900). o Holiday data, or any data that includes zero (0) numeric values for volume, open, high, low, or close should not be included in any of your data files. o Data is not adjusted for splits or ex-dividends by Stable. 6.3 Examples ------------- The following are examples of various ASCII data files which Stable Technical Graphs can read. Each example is a general representation of a particular market group. In all examples, the use of the comma to separate individual fields can be replaced by a tab character in your actual data. Market Index: DHLC 1/02/90,2811.60,2732.50,2810.10 1/03/90,2834.00,2786.30,2809.70 1/04/90,2821.40,2766.40,2796.00 1/05/90,2810.10,2758.10,2773.20 1/08/90,2803.90,2753.40,2794.30 The above illustrates a file containing 5 data records. Each data record contains four fields identified by the "DHLC" line. The sequence of the fields is "D"aily Date, "H"igh, "L"ow, and "C"lose. Decimal values are used for numerics. Note that 'D0' could have also been used to represent this date format. Data Files 6-4 Mutual Fund: W1C 010389, 14.28 011089, 14.69 011789, 14.67 012489, 14.90 013189, 15.28 The above illustrates a file containing 5 data records. Each data record contains two fields identified by the "W1C" line. The sequence of the fields is "W"eekly Date (in MMDDYY form) and "C"lose. Decimal values are used for numerics. Stock: D3VHLC 900102, 3913, 52 7/8, 52 3/8, 52 3/8 900103, 3628, 53 3/8, 52 1/8, 53 3/8 900104, 5057, 54 1/4, 53 1/4, 53 7/8 900105, 4624, 53 5/8, 53 1/8, 53 3/8 900106, 5203, 53 1/4, 51 5/8, 52 3/4 The above illustrates a file containing 5 data records. Each data record contains five fields identified by the "DVHLC" line. The sequence of the fields is "D"aily Date (in YYMMDD form), "V"olume, "H"igh, "L"ow, and "C"lose. Volume information is represented as a decimal value, while fractional values are used for all others. U.S. Treasury Strips: DC "01/03/89", 99:14 "01/10/89", 99:12 "01/17/89", 99:21 "01/24/89", 100:01 "01/31/89", 99:15 The above illustrates a file containing 5 data records. Each data record contains two fields identified by the "DC" line. The sequence of the fields is "D"aily Date and "C"lose. Special fractional values are used representing 1/32ths. NOTE the use of double-quotes in the data. Stable Technical Graphs ignores these. Data Files 6-5 6.4 Historical Data Suppliers ------------------------------ The following list includes those companies that can provide historical stock market data which can be used directly by Stable Technical Graphs. Please contact these companies directly for product information and pricing. TeleChart 2000 Worden Brothers, Inc. 4905 Pine Cone Drive, Suite 12 Durham, NC 27707 (800) 776-4940 (Sales) (919) 408-0542 (Voice) Commodity Systems, Inc. 200 W. Palmetto Park Rd. Boca Raton, FL 33432 (800) 327-0175 (Sales) (407) 392-8663 (Voice) Technical Tools 334 State Street, Suite 201 Los Altos, CA 94022 (800) 231-8005 (Sales) (415) 948-6124 (Voice) The following companies may also be able to provide historical data in a format compatible with Stable. Genesis Financial Data Services PO Box 49578 Colorado Springs, CO 80949 (719) 260-6111 Tick Data, Inc. 720 Kipling Street, Suite 115 Lakewood, CO 80215 (303) 232-3701 (Voice) (303) 232-0329 (Fax) Chapter 7 Dynamic Data Exchange This chapter summarizes the Dynamic Data Exchange (DDE) support provided within Stable Technical Graphs. Much of the discussion in this chapter assumes you are familiar with the concept of interprocess communications using DDE in the Windows environment. The first section 7.1 addresses DDE communications as it relates to programming in Windows. Section 7.2 describes DDE functionality as it relates to Microsoft Excel usage. As an additional aid in understanding DDE communications with Stable, refer to the file STABLE.XLM for an example of not only communicating with Excel, but also as a reference to the DDE command structures. 7.1 Programmers Reference -------------------------- This section assumes that you are familiar with the concepts and functionality associated with DDE Client/Server communications. Stable Technical Graphs functions as a DDE server application; responding to client applications by providing technical graph services in the areas of chart display management and real-time data update. In the area of display management, Stable Technical Graphs provides basic control over the creation and display of technical charts. o Charts can be opened or created by a DDE client application through the use of execute transactions issued to Stable within the "SYSTEM" topic. o The main Stable window can be controlled using DDE execute transactions. Supported commands allow the window to be minimized, shown (normal), and closed. o Individual charts can be controlled visually through DDE execute transactions. Among the supported command actions are minimize, maximize, print, show, close, and update. Real-time data update of Stable charts is also supported. By passing ASCII data record information conforming to the underlying security's content, new financial data can be submitted to a Stable chart for immediate update and display. 7.1.1 Application (Service) Name --------------------------------- For all DDE communication connections made to either the main Stable window or a Stable security chart, use the name "STABLE" as the application or service name. Dynamic Data Exchange 7-2 7.1.2 Topics ------------- The following application topics are supported by Stable. Generally, there are two classes of topics; the SYSTEM topic and individual chart topics. "SYSTEM" The "SYSTEM" topic represents the logical data context associated with the main Stable window. It is through a DDE conversation with the "SYSTEM" topic that visual control of the main window is performed - as well as creating or opening new Stable technical charts through a DDE conversation. "<chart_name>" The "<chart_name>" topic represents a specific Stable chart that is currently in existence on the Windows desktop. The use of the label "<chart_name>" in this context represents the actual file or security name associated with the window, and is found in the window's caption or title bar. For example, a chart created from data contained in the file "DJ30.CSV" results in a "<chart_name>" of DJ30.CSV. DDE conversations with "<chart_name>" topics allows you to control the chart's display (ie., minimize, maximize, show, close), the printing of the chart, and to dynamically add new data into the chart. 7.1.3 DDE Request Transactions ------------------------------- A client can send request (XTYP_REQUEST) transactions to a Stable server in order to receive specific information about the server. The following request "items" are supported within the "SYSTEM" topic (or Stable window): SZDDESYS_ITEM_TOPICS A list of topics supported by the "SYSTEM" topic. Currently return information is: "SYSTEM" "<chart_name>" * For each created chart. Dynamic Data Exchange 7-3 SZDDESYS_ITEM_SYSITEMS A list of items supported under the "SYSTEM" topic. The following information is currently returned: "SYSITEMS" "FORMATS" "TOPICS" "STATUS" SZDDESYS_ITEM_FORMATS A list of clipboard formats supported by the server. At the present time, the following formats are supported: "TEXT" "CSV" SZDDESYS_ITEM_STATUS The status of the server (busy or ready). The following request "items" are supported within a "<chart_name>" topic (an individual Stable chart): SZDDE_ITEM_ITEMLIST A list of items supported by the "<chart_name>" topic. The currently supported items are: "TOPICITEMLIST" "FIELDDEF" "DATERANGE" "STATUS" "NEWDATA" SZDDESYS_ITEM_STATUS The status of the server (busy or ready). "FieldDef" Returns a description of the data contents associated with the chart. The returned description is identical to the description of the <Format_String> described in section 6.2 of "Chapter 6 Data Files". The importance of the "FieldDef" information is that it describes the expected format of any ASCII data record submitted to the chart for the purpose of data update through a DDE conversation. "DateRange" Returns the entire date range of the chart's data as two dates of the format YYMMDD. For example, a chart consisting of data for all of 1993 might return "930104,931231". Dynamic Data Exchange 7-4 7.1.4 DDE Execute Transactions ------------------------------- A client can send execute (XTYP_EXECUTE) transactions to a Stable server in order to perform a command or series of commands. The following execution "command strings" are recognized by the "SYSTEM" topic (Stable window): "[MINIMIZE]" Minimizes the Stable application window. "[MAXIMIZE]" Maximizes the Stable application window. "[CASCADE]" Redisplay all charts as cascaded windows. "[TILEVERTICAL]" Redisplay all charts as vertically tiled windows. "[TILEHORIZONTAL]" Redisplay all charts as horizontally tiled windows. "[SHOW]" Displays the normal Stable window. "[CLOSE]" Closes the Stable window, essentially terminating the Stable program. "[OPEN(<type>,<path>,<file>)]" Opens a new chart. This command is basically the same as the File New Chart menu selection with the exception that the associated file information is specified in the execute command string itself. <type> represents one of the data file formats supported by Stable Technical Graphs. CSV Comma separated value (ASCII format). TC2000 TeleChart 2000 (TC2000) TT Technical Tools data format. CSI Commodity Systems, Inc. data format. MS MetaStock data format. <path> specifies the fully qualified path to the data file which is to be used in creating the new chart. The file name itself (if applicable) IS NOT a part of this field. <file> is the name of the symbol or data file for chart creation. In the case of CSV and Technical Tools data, this field represents the actual name of the file on disk. For CSI and MetaStock data, the field identifies the symbol description. Dynamic Data Exchange 7-5 EXAMPLE 1: The following execution command string instructs Stable to open a chart for Apple Computer using TC2000 data installed in the base C:\TC2000 directory: "[OPEN(TC2000,C:\TC2000,AAPL)]" EXAMPLE 2: The following execution command string instructs Stable to open a chart using the CSV data stored in the file HRB.CSV (H&R Block) located in the C:\MKTDATA directory: "[OPEN(CSV,C:\MKTDATA,HRB.CSV)]" EXAMPLE 3: The following execution command string instructs Stable to open a chart using the CSI data identified with "PORK BELLIES" in the C:\QUICK\DATA\MEATS directory: "[OPEN(CSI,C:\QUICK\DATA\MEATS,PORK BELLIES)]" EXAMPLE 4: The following execution command string instructs Stable to open a chart using the MetaStock data identified with "BOEING" in the C:\MS\DATA directory: "[OPEN(MS,C:\MS\DATA,BOEING)]" EXAMPLE 5: The following execution command string instructs Stable to open a chart using the Technical Tools data stored in the file SP___88Z.TTT (S&P Dec '88 Tick Data) located in the C:\TECHTOOL\SP directory: "[OPEN(TT,C:\TECHTOOL\SP,SP___88Z.TTT)]" The following execution "command strings" are recognized by a "<chart_name>" topic (an individual Stable chart): "[MAXIMIZE]" Maximizes the chart window to full screen. This is useful for when a chart will be printed. "[MINIMIZE]" Minimizes the chart window to an icon. "[SHOW]" Displays the chart in its last display size. "[CLOSE]" Closes the chart's window, effectively removing the chart from the Windows desktop. "[PRINT]" Instructs a chart to print itself to the default system printer. "[UPDATE]" Instructs the chart to redraw its contents. Normally this instruction will never be necessary as charts update automatically when new data is submitted. Dynamic Data Exchange 7-6 "[EXPORT(file,symbol,format,startdate,enddate,header)]" Exports the price data of the chart to an ASCII file. <file> is the name of the resulting output file. <symbol> is the symbol identifier to be used if the format contains a '$' identifier. <format> is a valid Stable data format description identifying the field format to output (See Chapter 6). <startdate> <enddate> is the date range (specified as YYMMDD) of the data to output. <header> is a flag indicating whether the data format record should be written as the first record in the file. "Y" is yes. 7.1.5 DDE Poke Transaction --------------------------- A client application can send unsolicited data to a Stable chart through use of the DDE poke (XTYP_POKE) transaction. This is the method by which new or real-time data can be submitted to a Stable chart for display and update. The item name used to indicate new financial data being submitted to a chart is the text "NEWDATA". Data information representing new chart data is passed as an ASCII string of information conforming to the data field definition for the chart. The data field definition for a chart can be obtained by issuing a "FieldDef" request transaction to the chart. The chart will return a field definition string of the format described in section 6.2. Content-wise, an ASCII data string passed to a chart containing new financial information looks like a single record found in a CSV data file. Regardless of the data type used to originally create a Stable chart, ASCII information is the only format supported for updating a chart. As an example, assume a chart has been created from a MetaStock data file - and further assume the data file is associated with the Dow Jones Industrials. After establishing a DDE conversation with the chart, you execute a request (XTYP_REQUEST) transaction for "FieldDef" and receive the data string "DVHLC" (date, volume, high, low, close). Dynamic Data Exchange 7-7 In order to update the chart with new data, you must first formulate an ASCII string similar to the following (which represents the field definition previously returned), and then submit it as the data portion of the "NEWDATA" poke (XTYP_POKE) transaction: "04/01/92,32190,3232.45,3209.51,3220.52" 7.2 Stable DDE Communications with Excel ----------------------------------------- Performing DDE communications directly with Stable through Microsoft Excel is relatively straight-forward since all of the programming details are automatically performed for you. Following a simple set of rules, you can easily communicate with Stable, or any of Stable's charts, from within a spreadsheet. For additional information, please refer to the STABLE.XLM macro file provided with Stable Technical Graphs. By having Excel display the actual formulas on the STABLE.XLM macro sheet, you can actually see examples of working formulas used to communicate with Stable. The following briefly describes some of the macros and formulas used in the STABLE.XLM macro sheet. Details on how to create proper formulas and macros within Excel can be found in your Microsoft Excel documentation. 7.2.1 Open HRB Macro --------------------- This macro demonstrates how a Stable chart can be created from DDE commands placed in a spreadsheet. This example requires that STABLE.EXE be in your "PATH=" statement and that the HRB.CSV file resides in the C:\STABLE subdirectory (you are free to change the directory if required in order to access the data file). =INITIATE(Stable,"System") Establish a DDE channel with the Stable window. =EXECUTE(channel,"[OPEN(CSV,C:\STABLE,HRB.CSV)])" Open a new chart using the CSV data file HRB.CSV found in the C:\STABLE subdirectory. =TERMINATE(channel) Terminate the DDE conversation. =RETURN() Terminate the macro. Dynamic Data Exchange 7-8 7.2.2 Poke HRB Macro --------------------- This macro demonstrates a technique for adding data found in a spreadsheet directly into an existing Stable chart. * If you want to see the visual results of the data being added to the HRB.CSV chart, resize Excel and the HRB.CSV chart so that both are visible on the screen before executing this macro. =INITIATE(Stable,"HRB.CSV") Establishes a DDE conversation with the HRB.CSV chart window. =POKE(channel,"NEWDATA",$A12:$E12) =POKE(channel,"NEWDATA",$A13:$E13) =POKE(channel,"NEWDATA",$A14:$E14) =POKE(channel,"NEWDATA",$A15:$E15) =POKE(channel,"NEWDATA",$A16:$E16) =POKE(channel,"NEWDATA",$A17:$E17) This set of instructions retrieves the six rows of financial data found in the macro sheet and submits each individually to the HRB.CSV chart. The "$A12:$E12" parameter essentially tells Excel to format the data in that row as ASCII and comma separated. =TERMINATE(channel) Terminate the DDE conversation. =RETURN() Terminate the macro. 7.2.3 Show HRB Macro --------------------- This macro demonstrates how commands can be issued to a chart in order to control its appearance. =INITIATE(Stable,"HRB.CSV") Establishes a DDE conversation with the HRB.CSV chart window. =EXECUTE(channel,"[SHOW]") This command instructs the HRB.CSV chart to display itself. =TERMINATE(channel) Terminate the DDE conversation. =RETURN() Terminate the macro. 7.2.4 Supported =EXECUTE() Commands ------------------------------------ The list of commands that can be used with =EXECUTE() formula are explained above in section 7.1.4. Chapter 8 Technical Indicators This appendix summarizes those technical indicators found in the evaluation copy of Stable Technical Graphs, Version 2.0. The following is an alphabetic list of indicators found in the product. Commodity Channel Index (CCI) Moving Average Convergence/Divergence (MACD) Moving Averages (Exponential, Simple, Weighted) Multiple Data Graph Negative Volume Index (NVI) Negative Volume Trend (NVT) On-Balance Volume Open Interest Point & Figure Positive Volume Index (PVI) Positive Volume Trend (PVT) Price Channel (Trading Band) Price Momentum Price Oscillator Price Performance Rate of Change (Price and Volume) Relative Strength Relative Strength Indicator (RSI) Stochastic Volume Volume Oscillator Weighted Close For detailed information on technical indicator theory and practice, we highly recommend that you consider the following publications: Technical Analysis Explained Martin J. Pring Technical Analysis of the Futures Markets John J. Murphy The New Commodity Trading Systems and Methods Perry J. Kaufman The Encyclopedia of Technical Market Indicators Robert W. Colby & Thomas A. Meyers Technical Analysis of Stock Trends Robert D. Edwards & John Magee New Concepts in Technical Trading Systems. J. Welles Wilder. Technical Indicators 8-2 8.1 Moving Averages -------------------- Generally, moving averages are used to smooth out the data values used for technical analysis; helping to eliminate both large and small fluctuations normally found in the data, and to help identify the directional trend of the data being averaged. Stable Technical Graphs supports three different types of moving average calculations; the simple moving average, the weighted moving average, and the exponential moving average. Any of these moving averages can be applied to the base data associated with almost all graphs found in the product. The calculation of the simple moving average simply adds together a number of the most recent data values and divides the resulting sum by the total number of values being added together. For example, a ten day moving average is computed as the sum of the ten most recent data values, divided by 10. In the simple moving average system, all data values are given an equal "weight" - effectively assigning the same importance to each data element used to calculate the average. Some people feel that it would make more sense to assign greater importance to the more recent data and criticize the simple moving average for lacking this. The weighted moving average is similar to the simple moving average except that each value being considered in the average is assigned a specific "weight". The greatest weight is assigned to the most recent data value, while the least weight is given to oldest value. This has the effect of associating "greater importance" to more recent data when calculating this average. The assignment of specific data value "weights" is performed automatically by the program. Stable uses the method of assigning the ordinal value of the data item within the list as the weight. Calculating a 5 day average for example, the first value is multiplied by 1, the second by 2, the third by 3, the fourth by 4, and the fifth by 5. The five resultant products are then added together and divided by 15 (1+2+3+4+5) to determine the average. The exponential moving average is somewhat similar to the weighted moving average in that the most recent data is also assigned more importance than data further back in time. However, instead of "weighting" each individual data value, a "fixed weight" is assigned to today's (the most recent) value, while all of the remaining weight is given to the previous value of the exponential moving average itself. In calculating this moving average, you begin by first establishing the average as equal to the first day's data, then moving through the series of data - multiplying each new recent value by some fixed weight (like 12%) and the previous value of the average itself by the all the remaining weight (88% in this case). Technical Indicators 8-3 8.2 Negative/Positive Volume Indexes (NVI/PVI) ----------------------------------------------- Both the Negative Volume and Positive Volume Indexes are indicators based upon the premise that trading volume increases when unsophisticated investors are active in the market, while the so- called "smart money" investors are busy in the market during periods of declining volume. The price direction on days of declining volume may then indicate "smart money" accumulation or distribution if the change is positive or negative respectively. The primary distinction between these two indicators is simply which volume move is being measured. The NVI calculation is related to negative, or falling volume. When the volume decreases from the previous period (rising volume does not affect this indicator), the NVI is adjusted by the percentage change in the price. Specific to the NVI, long positions are taken when the indicator crosses ABOVE its moving average. The PVI calculation is related to positive, or rising volume. When the volume increases from the previous period (falling volume does not affect this indicator), the PVI is adjusted by the percentage change in the price. Effectively, PVI measures what the "uninformed" masses are doing - and long positions are taken when the PVI crosses BELOW its moving average. 8.3 On-Balance Volume ---------------------- The On-Balance Volume Indicator (developed by Joseph Granville) is used to indicate whether an accumulation or distribution of shares for a security is occurring by studying the security's volume activity in relation to the price change. The basic theory behind the OBV indicator is that it tends to exhibit trend changes in advance of price changes - therefore look for a change in the OBV trend to suggest a forthcoming change in the price trend. The OBV indicator is a cumulative total of volume calculated by adding the entire day's volume to the total if the price rises for that day, and subtracting the entire day's volume if the price falls for that day. (See Volume Trend for a variation of this indicator). 8.4 Oscillators (Price and Volume) ----------------------------------- The Price and Volume Oscillators are indicators representing the difference between two moving averages of the respective price or volume data. When plotted, the oscillator rises and falls through a "zero line" - and represents the actual "crossing" of the two moving averages. Technical Indicators 8-4 As the oscillator crosses and moves above the zero line, this indicates that the first moving average is moving upwards at a faster rate than the second average. This can be interpreted as a rising trend and, if the first average is based on a shorter time period than the second, that the short term trend is currently stronger than the long term trend. If the oscillator crosses and moves below the zero line, this is an indication that the first moving average is falling at a rate faster than the second average. This can be interpreted as a falling trend and, if the first average is based on a shorter time period than the second, that the short term trend is now weaker than the long term trend. One way to help visualize an oscillator is to create a Stable chart containing both a Price Graph (with two moving averages), and a Price Oscillator Graph based on the same two moving averages. As the moving averages cross each other on the Price Graph, you will see the Price Oscillator line cross its zero line. You can also use an Oscillator graph to track when a single moving average crosses the data which it is based upon - by setting the first oscillator unit to 1 and the second to the moving average units you want to plot. The resultant oscillator graph then shows when the moving average crosses the underlying data. The higher the oscillator, the greater the data is above its moving average, and conversely on the downside. 8.5 Price Channel (Trading Band) --------------------------------- Available only on Price Charts, the Price Channel or Trading Band is a special indicator used to envelop price activity within a specific trading range. The Price Channel is created by calculating a single moving average (either simple, weighted, or exponential), and then displaying the moving average line (shifted vertically) an equal percentage both above and below its calculated value. While the Price Channel can be manually created using two individual moving averages, the Price Channel greatly simplifies the task. 8.6 Price Momentum ------------------- Price momentum is the ratio between today's price and the price some specified number of units in the past. High Momentum readings sometimes imply that the security is in an overbought condition, while extremely low readings may suggest an oversold situation. (Today's value - N_units_ago value) * 100 Price Momentum and Price Rate of Change are essentially the same technical indicator. Technical Indicators 8-5 8.7 Rate of Change (Price and Volume) -------------------------------------- The Rate of Change (ROC) is a method used to measure the momentum of a security. Rate of Change is computed as the percentage change between today's value (price or volume) and the associated value some specified number of units in the past. High Rate of Change readings sometimes imply that the security is in an overbought condition, while extremely low readings may suggest an oversold situation. (Today's close - N_units_ago close) / N_units_ago close 8.8 Volume ----------- The Volume Indicator displays the security's trading volume as vertical bars for each day of data. The base value for the Volume Graph is the lowest volume value for the current graphing period. 8.9 Negative/Positive Volume Trend (NVT/PVT) --------------------------------------------- The Volume Trend indicators are variations of the basic On-Balance Volume indicator. The primary difference between these indicators and the OBV is in what portion of the day's volume is used to determine the new indicator value. Unlike the OBV (which applies the entire day's volume), both NVT and PVT use only a portion of the volume determined as a percentage of the price change from the previous day. In effect, these indicators consider the magnitude of the period's price change - whereas OBV does not. The major distinction between the NVT and the PVT is that the NVT theorizes that the LESS volume required to move the price, the more significant is the event. All things being equal, a period of low trading volume will affect this indicator more than if the same period was driven by high trading volume. This, in effect, is similar in concept to the Negative Volume Index - where we're looking for "smart money" activity in the market. 8.10 Weighted Close -------------------- The Weighted Close is simply a weighted indicator of the closing values for a security. It is calculated daily by adding the security's high and low value to the closing value doubled - then dividing the result by four. ( (Today's close * 2) + High + Low ) / 4 Technical Indicators 8-6 8.11 Commodity Channel Index (CCI) ----------------------------------- The Commodity Channel Index, originally developed by Donald Lambert, is a tool that assists in identifying when an underlying security's cycle trend is in effect. The indicator is displayed as an oscillator with major signal lines at +100 and -100. The general interpretation is that when the oscillator breaks through either of these lines, it is an indication that the security may be starting a new trend. 8.12 Moving Average Convergence/Divergence (MACD) -------------------------------------------------- Developed by Gerald Appel, the MACD is a widely used oscillator derived from the differential of two exponential moving averages; a short term average and a longer term average. In a trending market, the shorter term average will rise or fall more quickly than the slower long term average, thereby resulting in a larger difference between the two. By plotting the mathematical difference of the two averages, an oscillator is created that rises and falls around a "zero-line". The farther away the oscillator is from the zero-line, the greater the strength of the trend. By calculating an exponential average of the oscillator itself, you have what is described as a "signal line". The time frame normally used for the signal line ranges from 5-10 days in length. Basic interpretation theory suggests that buy and sell signals are generated whenever the oscillator (MACD) line crosses its signal line. When the MACD line crosses from below to above the signal line, a buy signal is in effect. When the MACD line crosses from above to below the signal line, a sell signal is generated. Experiment with different exponential average periods for the MACD oscillator and look for divergences between the price action and the MACD oscillator itself to help identify the most profitable trading signals. 8.13 Open Interest ------------------- The Open Interest Indicator displays the security's open interest as vertical bars for each day of data. The base value for the Volume Graph is the lowest value for the current graphing period. Technical Indicators 8-7 8.14 Relative Strength ----------------------- The Relative Strength graph allows you to compare the price action between two securities or other financial index - typically used to compare a security against its associated "index" or base. For example, you might construct a relative strength graph comparing how IBM is performing against the DJIA as a whole , or how Exxon is performing against Chevron. Calculated simply by dividing the security's value by the comparitive financial item, the Relative Strength measures the relationship between the two. An important point to remember is that this indicator represents the relative relationship between the items, and does not directly reflect individual price action. As a result, even if both securities prices are falling, the Relative Strength line will move upwards if the primary security's prices are falling less than the relative security. 8.15 Relative Strength Indicator (RSI) --------------------------------------- The Relative Strength Indicator was developed by Wells Wilder in an effort to measure the internal strength of a security. Unlike the Relative Strength graph described above which compares two financial items, the RSI oscillator determines the momentum strength within a single security. The RSI calculation serves to resolve two issues related to the normal determination of a momentum indicator; the smoothing out of erratic price movements, and to provide a normalized trading range for comparison purposes. The RSI graph presents the indicator as fluctuating between the values of 0 and 100. Traditionally, lines are drawn on the graph at the 70 and 30 levels; representing overbought and oversold points respectively. Once an overbought or oversold situation presents itself, look for a price trend reversal for an actual buy or sell signal. Technical Indicators 8-8 8.16 Stochastic ---------------- The Stochastic Indicator, developed by George Lane, measures on a percentage basis, where the closing price is in relation to the total trading range during a specified past number of days. The significance of this indicator is based on observations that the closing price generally is closer to the top of the price range during periods of rising prices - and nearer the bottom during downtrends. When interpeting the graph, values above 70 place the closing price near the top of the range, while values below 30 place the close near the bottom of the range. High readings might suggest possible sell points while low readings a potential buy indication. 8.17 Performance ----------------- The Performance Indicator measures the percentage change on a day by day basis from the most recent date. The very last value (most recent date) on the graph is always zero (0) - indicating that the percentage change from today is 0. To determine the percentage change in price between the most recent date and a date in the past, turn on the data display for the Performance graph. Move the "slider" so that the hair cursor is positioned on the date in the past, and read the displayed value. This is the percentage change in price. 8.18 Point & Figure -------------------- Point and Figure charting is the study of strictly price movement; time is not considered in the graphing of the price activity. Bar charts take both time and price into consideration when plotting financial data. For example, on a daily bar chart, each new day is plotted one "space" to the right of the previous day. Traditionally, Point and Figure charts are created using alternating columns of X's and O's. Each column represents only the price movement of the graphed data - X's reflect periods of rising prices while O's indicate periods of falling prices. Any individual column may represent 1 day, 1 week, 1 month - practically any time frame. Technical Indicators 8-9 When Point and Figure charts are contructed, you specify a box size and a the number of boxes required to force a change in direction (reversal). Box size is specified as the dollar amount necessary to create a new box (X or O) on the chart. Whenever the price activity moves at least one box size, a new X or O is added to the chart. Should the price move be at least twice the box size, two boxes would be drawn. The reversal size (number of boxes) is used to determine when a new column is to be created. A reversal size of 3 boxes in effect says, "If the price moves in the opposite direction at least 3 * box size, begin a new column." For detailed discussions about interpreting this, or any other indicator, refer to the books mentioned at the beginning of this chapter.