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Improved Moving AveragesVolume Weighted IndicatorsBy applying volume weighting to classical movingaverages, we are able to develop a much better—and faster—moving average that helps us enter themarket at better chart points AND helps protectus from a premature exit. It’s called the VolumeWeighted Moving Average, or VWMA, and it’sincluded in Volume Systems 2.0.The chart to the right for Royal Caribbeandemonstrates the concept. You can see that inMarch 2009, price crossed the 100 period VolumeWeighted Moving Average a full 5 days beforeit crossed the Exponential Moving Average—ata price difference of 20%. If we were using the100 bar Exponential Moving Average we wouldhave entered our Long position at a significantdisadvantage. Plus, if you follow the blue line, youwill see that the price chart maintains separationabove the line, keeping us in the trade longer.Volume Weighted MACDVWMA – a faster, cleanermoving average.$10.25$8.75We used VWMA to create a similar Systemto MAC-M, which is based on the differencebetween the 12 and 26 period Exponential MovingAverages. If you look at the chart to the right forGoldman Sachs, you will see that the new Systemvirtually eliminated whipsaw Signals!Why does this work? If you look carefully at theindicator, you can see that the volume weightingadjusts the curve towards the peaks and valleys.This pulls it away from the “trigger line” so itdoes not fire on the little “wiggles” or whipsawsthat hinder the MAC-M System.whipsawsOur System testing shows a significantimprovement in results for VWMACD overMACD by itself. If you are using the MAC-MSystem, you will want to consider replacing itwith this System.VWMACD-C (lower) is compared to the MAC-M system. Notice that while theSignals are similar, several whipsaws were avoided.8
Powerful NewLong Term StrategyBased on Volume Weighted IndicatorsNew Volume Systems 2.0Power Strategy generateshigh returns in recent market.Building a robust long term Strategy usingTechnical Analysis is difficult, because mosttechnical methods are more or less fixatedon the very near price action. But volumeweighting has ushered in a new era ofanalysis that has the potential to generatesuperb long term Signals.The Volume Systems 2.0 Power Strategyuses both the DVF-C and VWMACD-CSystems discussed on pages 7 and 8. Itcombines them to look for tell-tale signsthat the professionals are beginning toaccumulate a stock. And we must admit,the concept is simply amazing.In a recent test on the Russell 1000,we generated the following statisticson the 100% Mechanical Strategy:11% Profi t per Trade!The long term Strategy fi red several great trades on AVY.Period ..................... 1/09 – 6/10Trades .................... 455Hit Rate .................. 72%Average Bars ........... 38Average PPT ......... 11.8%This is an incredible average profitper trade for a Mechanical Strategy.And it’s showing 72% accuracy.When you think about the fact thatthis test was run over a large index(the Russell 1000), it’s very impressive.We are very pleased to include thisfabulous long term Strategy with ournew Volume Systems 2.0 release.Some of the long term trades in our test earned far greater than 11%. One ofthe CTAS trades shown here made nearly 40%!9
Page 1: Nirvana’sVolume Systems 2.0Turn u
Page 4 and 5: An Introduction toVolume Flow Analy
Page 6 and 7: Detect Change in Trend EarlyThe NEW
Page 10 and 11: SPECIAL BONUS!Swing Trade Divergenc

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