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MP Definitions

Definitions
Initial Balance (IB) The range from the low of the opening 60 minutes of the
market to the high of the opening 60 minutes. The high or the low of the initial
balance will form the high or the low for the day 70% of trading days.

Initiative Buying Buying above the value area. Initiative buying would imply
that you expect the current uptrend to continue as you are willing to buy at a
higher price than you could have bought during the previous day. With initiative
buying you are looking to capitalize on a fast moving market that is making new
highs.
Initiative Selling Selling below the value area. Initiative selling would imply
that you expect the current downtrend to continue as you are willing to sell at a
lower price than you could have sold during the previous day. With initiative
selling you are looking to capitalize on a fast moving market that is making new
lows.
Point of Control (POC) The single price that contains the highest volume for
the time frame being examined.

Poor High When exactly 2 TPOs exist at the high for the day. A poor high will
generally lead to higher prices unless it occurs against resistance. This is
referred to as a double top in most trading circles but a poor high should
generally never be shorted as it indicates acceptance at the market high.

Poor Low When exactly 2 TPOs exist at the low for the day. A poor low will
generally lead to lower prices unless it occurs against support. This is referred to
as a double bottom in most trading circles but a poor low should generally never
be bought as it indicates acceptance at the market low.

Responsive Buying Buying below the value area. Responsive buying would
imply that you expect the market to return to the mean (the center). Buying
responsively in an uptrend is a strong play.
Responsive Selling Selling above the value area. Responsive selling would
imply that you expect the market to return to the mean (the center) Selling
responsively in a downtrend is a strong play.
Rotation Factor (RF) A calculation that shows the strength of the current
market trend. It is calculated by assigning a value from -2 to +2 to each TPO. A
value of -1 is assigned to the low of the current TPO if its low is lower than the
low of the previous TPO, a value of 0 is assigned to the low of the current TPO if
its low is the same as the low of the previous TPO, and a value of +1 is assigned
to the low of the current TPO if its low is higher than the low of the previous TPO.
The same applies to the highs. A value of -1 is assigned to the high of the
current TPO if its high is lower than the high of the previous TPO, a value of 0 is
assigned to the high of the current TPO if its high is the same as the high of the
previous TPO, and a value of +1 is assigned to the high of the current TPO if its
high is higher than the high of the previous TPO. All of the values are then added
together to get the rotation factor for the current day.

TPO Count A count of the number of TPOs above the point of control to the
number of TPOs below the point of control. A TPO count of 99/45 would signify
there were 99 TPOs above the point of control and 45 TPOs below the point of
control. This example, 99/45, indicates control by the sellers since there were
more traders willing to sell above the point of control than there were traders
willing to buy below the point of control. The figure below demonstrates the
calculation.

Value Area The prices that contain 68% of the days total volume. The value
area is the location where prices are most accepted. In general, the value area
should be avoided for placing trades as it is often quite choppy inside the value
area. The best trade locations will occur above or below the value area. Initiative
buying occurs above the value area and is a result of buyers showing strength to
move the market higher. Initiative selling occurs below the value area and is a
result of sellers showing strength to move the market lower. Responsive buying
occurs below the value area and is a result of buyers seeing an opportunity to
purchase below value looking for the market to move back toward the middle of
value. Responsive selling occurs above the value area and is a result of sellers

seeing an opportunity to short above value looking for the market to move back
toward the middle of value.

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