VIDYA - The Variable Index Dynamic Index

by Tushar Chande


VIDYA is basically an adaptive exponential moving average.

The adaptation speed is determined by market momentum, as measured by "AbsCMO",
the absolute value of the Chande Momentum Oscillator.

This indicator is described in Chapter 3 of Dr. Chande's book "The New Technical Trader".

[Tams]

// Type : Function
// Name : VIDYA

Input: 
Price(numericseries), 
CMOLen(numeric), 
VIDYALen(numeric),
Speed(numeric);

Var: 
Cnt(0),
SumUp(0), 
SumDn(0), 
Diff(0),
VIDYAPri(0),
AbsCMO(0),
Const(0);

SumUp = 0;
SumDn = 0;

For Cnt = 0 to CMOLen-1 Begin
Diff = Price[Cnt] - Price[Cnt+1];
If Diff > 0 then SumUp = SumUp + Diff else SumDn=SumDn-Diff;
End;

AbsCMO = Speed*AbsValue((SumUp-SumDn)/(SumUp+SumDn));
Const = 2/(VIDYALen+1);

VIDYA = iff(Barnumber>VIDYALen,(Price*Const*AbsCMO) +
((1-AbsCMO*Const)*VIDYA[1]),Price);

// Type : Indicator
// Name : VIDYA

Input: 
Price(TypicalPrice), 
CMOLen(9), 
VIDYALen(12), 
UBandPct(1),
LBandPct(1),
Speed(1);

Var: 
PlotVal(0);

PlotVal = VIDYA(Price,CMOLen,VIDYALen, Speed);

If PlotVal > 0 then 
begin
Plot1(PlotVal,"VIDYA");
Plot2((1 + UBandPct*.01)*PlotVal,"Upper Band");
Plot3((1 - LBandPct*.01)*PlotVal,"Lower Band");
End;

[Tams]

additional information in:

ActiveTraderMag / June 2001 - "Measuring Trend Momentum".

S&C Magazine, Traders Tips / October 1995 - "Identifying Powerful Breakouts Early"


.

[Tams]

related thread:
CMI - Chande Momentum Indicator
http://www.traderslaboratory.com/for...ator-6013.html