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Home > Tools and Charts > Strength of Trend
Strength of Trend
Measuring Opportunity with the Strength of Trend Indicator
Performance for any given year is a function of seizing available opportunity within any investment arena. The opportunity can be demonstrated using a sailboat analogy. The stronger and longer the wind blows the faster and further the sailboat should move. Conversely, in the absence of wind, obviously, we would not expect movement. The best sailboat in the world is not going to go anywhere without some sort of wind. Expanding the analogy, it is normal for winds to be blowing in most markets (trends) and occasionally for there to be strong winds in some markets (sustained trends).
Strength of Trend (SoT) Interpretation:
In general, SoT values greater than +5 indicate the presence of a noteworthy up move (or up trend) and SoT values less than -5 indicates the presence of a noteworthy down move (or down trend) in the markets. In addition, the average SoT reading for the 10 strongest up trending markets (Top 10) and the 10 strongest down trending markets (Bottom 10) are studied to measure the presence or absence of noteworthy price movement or trends across our portfolio. Our extensive research shows that it is not unusual for our markets to experience numeric values less than 5 (positive or negative) for sustained periods. However, it is unusual for most markets during the same time period to experience these low numbers simultaneously.
Getting Started with SoT . . .
The quick links listed below will educate investors and traders alike on the benefits of the SoT indicator.
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