Ask Colin

How do you plot the Advance/Decline & All Ords/Dow lines on the same chart?

With reference to your article Trend Trader April 2001 Shares - how do you plot the Advance/decline & All Ords/Dow lines on the same chart i.e. how do you establish the relationship between the two measures from some arbitrary starting point? The Dow appears to commence at the same point as the advance/decline line whereas the All Ords is well separated.

Answer

In Insight Trader charting software, you:

1. Create a chart of the index.

2. Create a chart of the advance-decline line in a separate window.

3. Ensure that the two charts start and end at the same dates.

4. Click the overlay button.

What happens in Insight Trader is that the two windows are simply overlaid. The scaling shown will be for one or other of the windows. If you tile the windows and make the advance-decline window the active window by clicking on its blue title bar, the scale on the overlaid chart will be for the index. It has no relevance for the advance-decline line, which is simply overlaid on the index chart. However, this is OK, because only the slope, not the value of the advance-decline line is relevant.

If you do not have Insight Trader software, there will be an equivalent function in your software package.

Keywords: