OPEN-SOURCE SCRIPT
CMOabs Strategy
// This indicator plots the absolute value of CMO. CMO was developed by Tushar
Chande. A scientist, an inventor, and a respected trading system developer,
Mr. Chande developed the CMO to capture what he calls "pure momentum". For
more definitive information on the CMO and other indicators we recommend the
book The New Technical Trader by Tushar Chande and Stanley Kroll.
The CMO is closely related to, yet unique from, other momentum oriented indicators
such as Relative Strength Index, Stochastic, Rate-of-Change, etc. It is most closely
related to Welles Wilder`s RSI, yet it differs in several ways:
- It uses data for both up days and down days in the numerator, thereby directly
measuring momentum;
- The calculations are applied on unsmoothed data. Therefore, short-term extreme
movements in price are not hidden. Once calculated, smoothing can be applied to
the CMO, if desired;
- The scale is bounded between +100 and -100, thereby allowing you to clearly see
changes in net momentum using the 0 level. The bounded scale also allows you to
conveniently compare values across different securities.
Chande. A scientist, an inventor, and a respected trading system developer,
Mr. Chande developed the CMO to capture what he calls "pure momentum". For
more definitive information on the CMO and other indicators we recommend the
book The New Technical Trader by Tushar Chande and Stanley Kroll.
The CMO is closely related to, yet unique from, other momentum oriented indicators
such as Relative Strength Index, Stochastic, Rate-of-Change, etc. It is most closely
related to Welles Wilder`s RSI, yet it differs in several ways:
- It uses data for both up days and down days in the numerator, thereby directly
measuring momentum;
- The calculations are applied on unsmoothed data. Therefore, short-term extreme
movements in price are not hidden. Once calculated, smoothing can be applied to
the CMO, if desired;
- The scale is bounded between +100 and -100, thereby allowing you to clearly see
changes in net momentum using the 0 level. The bounded scale also allows you to
conveniently compare values across different securities.
Open-source script
In true TradingView spirit, the creator of this script has made it open-source, so that traders can review and verify its functionality. Kudos to the author! While you can use it for free, remember that republishing the code is subject to our House Rules.
For quick access on a chart, add this script to your favorites — learn more here.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Open-source script
In true TradingView spirit, the creator of this script has made it open-source, so that traders can review and verify its functionality. Kudos to the author! While you can use it for free, remember that republishing the code is subject to our House Rules.
For quick access on a chart, add this script to your favorites — learn more here.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.