Kang-Lin Chiang
October 2007
Journal of International Finance & Economics;10/20/2007, Vol. 7 Issue 1, p36
Academic Journal
This research is using the Relative Strength Index (RSI) that proposed by Levy (1967) and the Modify Relative Strength Index (MRSI) that propose by this research to find trend. It is using the volume-price relationship and the price-volume relationship to modify the Relative Strength Index (RSI). For the index's base, it is called volume-price relationship is primarily focus on the trading volume rise and falling, and the price for auxiliary. Otherwise the price-volume relationship is primarily focus on the price rise and falling, and the trading volume for auxiliary. When investors face the uncertainty or do a forecast now. RSI and MRSI can provided to be an instrument to decide the invest strategy. This research find if investors forecast the stocks market will become the bull market, using the Relation Strength Index, which proposed by Levy, may get better return from stocks market. But if investors forecast the stocks market will become the bear market, using the Modify Relative Strength Index, which proposed by this research, may get better return from stocks market.


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