Rate of Change(ROC):
Rate of Change compares today’s price of a security with the price(of the same security) of a prior period of specified number of days. For example, a 10-day ROC is calculated by comparing the current day’s price with the price 10 days before. For comparison, subtraction or division are used. When both prices are same, in the case of subtraction, the difference is zero. In this case, zero line is the equilibrium line in the chart. When current price is higher, ROC is positive and when current price is lower ROC is negative.
Tuesday, December 18, 2007
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