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Does comparing FORCE readings for different securities make sense?

elphalba
elphalba ✭
in Scanning
If I use a “rank” statement to compare the Force(13) indicator of numerous stocks, will this information be useful in comparing "apples to apples", or will it be like comparing "apples to oranges"? Another way to ask is whether it makes sense to compare FORCE readings for different securities, even when there are large differences in the price?

Comments

  • markd
    markd mod
    I can't see how it would be meaningful, except to separate positive and negative Force values.

    A larger Force value does not tell you the stock is behaving more bullishly than another. Also, the absolute position of Force is not meaningful without reference to price and previous Force values (levels of prior peaks and troughs).

    Force is really a running total of volume, like OBV, except where OBV adds or subtracts volume depending on the sign of today's price change, Force multiplies volume by the SIZE and direction of the price change. So, higher volume stocks are going to produce much larger Force values regardless of whether price changes are comparable.

    Here's a link to the Chart School article:

    https://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:force_index

  • elphalba
    elphalba ✭
    Thanks for the clarification

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