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Wednesday, June 12, 2013

Daily Money Flow of FBMKLCI Top 30 Stocks 11062013

Daily Money Flow (DMF) Formulation

If previous change (A) + current change (B) > 0, then DMF = “IN”; AND if (A) + (B) < 0, then DMF = “OUT”.
Money Flow (MF) Calculation
The value of money flow is set to zero at the start of the trading day. When a trade is performed, its price is compared to the price of the previous trade (the first
trade of the day is compared to the previous day's close). If the prices differ, the money associated with the trade (price times number of shares) is added to or subtracted from the money flow. Additions (inflows, buys) are done on upticks; subtractions (outflows, sells) are done on downticks.
Daily Money Flow (DMF) Interpretation

In general, money flow trends confirm price trends. As prices rise, money flows are usually positive. As prices fall, money flows are usually negative. A
divergence, however, between money flow and price trend can be a signal of a future price trend change. For example, a
falling stock price with a positive money flow (IN) can indicate a future rally in the price of the stock. Conversely, a rising stock price with a negative money flow (OUT) implies potential
correction in the stock price.



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