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Re: WhiteSahara post# 1344

Thursday, 10/11/2012 10:08:05 AM

Thursday, October 11, 2012 10:08:05 AM

Post# of 79856
Subject: as regards MIMV (low volume until the recent days):
Correct use of moving averages matters.

Suppose we are looking at IBM. OK... so they have a history of meaningful volume so use things like the 50 MA & the 200 MA.

But we have a stock where there is no meaningful volume until late in the month of September, at which time HUGE volume kicked in.

So, to properly take into consideration the meaningfulness of the historical absence of volume, if someone is going to employ 50 day and 200 day MAs, I say it is obvious that the MAs need to be VOLUME WEIGHTED.

After all, how can it be legitimate to assume that the weight behind today's price action compares 1 to 1 to days 50 and 200 back, when there was all but NO VULUME?

Even if someone has only a rudimantary grounding in entry level statistics, logic demands the conclusion that the use of VOLUME WEIGHTED MOVING AVERAGES is warranted in the case of this stock.

As such, the 50 day VMA = .4679
and the 200 day VMA = .4224


Imperial Whazoo

"Just my opinions, folks. Do your own due diligence & make your own decisions. DO NOT... I repeat... DO NOT make any investment decisions on my comments. They are my opinions. That's all they are... OPINIONS."

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