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DMI (Dynamic Momentum Index)

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Chande's Dynamic Momentum Index: Indicator Documentation

Syntax


public DataSeries DyMoI( Bars bars )
public DyMoI Series( Bars bars, string description)

Parameter Description

bars Bars object

Description

The Dynamic Momentum Index (DMI) was developed by Tushar Chande and Stanley Kroll and presented in their book "The New Technical Trader". The DMI is an adaptive successor to RSI, and its adaptivity is based on the fact that the lookback period is variable, and is dictated by the recent market volatility. A shorter lookback will be used in active markets, and vice versa for quiet markets.

Interpretation

The indicator is interpreted in the same manner as the RSI: readings below 30 are considered oversold and numbers above 70 indicates overbought market condition.

Example

This example illustrates how to plot the Dynamic Momentum Index using Community Indicators:


using System;
using System.Collections.Generic;
using System.Text;
using System.Drawing;
using WealthLab;
using Community.Indicators;

namespace WealthLab.Strategies { public class DMI_Demo : WealthScript { protected override void Execute() { DyMoI dmi = DyMoI.Series( Bars ); ChartPane dmiPane = CreatePane( 30, true, true ); PlotSeries( dmiPane, dmi, Color.Blue, LineStyle.Solid, 2 ); } } }

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Used under license from FMR Corp. Copyright 2008 FMR Corp. All rights reserved.


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