Traders Notebook  |  APR 2003

Working Money: Postitive Volume Index by Dennis D. Peterson

Working Money: Postitive Volume Index by Dennis D. Peterson Is the primary market trend up or down? Writing about the positive volume index (PVI) takes me back to when I first started trying to understand the markets. I joined four stock clubs, searched the Internet extensively, and haunted the local library. I still belong to one of the clubs; its members use fundamentals. Even though they don’t subscribe to anything as voodoo-like as technical analysis, they do plot data on semi-log charts and use them as part of the decision-making process. I was also able to learn quite a bit at the library. In addition to Robert Edwards and John Magee’s classic Technical Analysis Of Stock Trends, I read Norman G. Fosback’s Stock Market Logic. Fosback’s book hit me, much the same way the stock club’s fundamental orientation contrasted with my technical analysis trading. Fosback didn’t see, for example, that there was added gain in going from standard to semi-log charting. The book was not about patterns, or any kind of visual investing techniques, but Fosback’s logic is compelling. But if Fosback likes an indicator, you can be sure it is reliable, and he happens to like PVI.

by Dennis D. Peterson