(12) Pass Band Muti VS-97

PBM transforms volatile and conflicting candles into obvious and easy trading decisions. It’s this simple; stocks trending in an upward direction will be above the zero line (1) in the chart below.  Stock trending downward will be below the zero line (2).  Zero line crossovers are indicating turning points and trading opportunities (3). This gives you advanced warning of when your trades are approaching the next turning point, as the indicator will migrate back toward the zero line.  Momentum, Volatility and Rate-of-Change are each unique and distinctive attributes of stocks in strong trends.  The Pass Band Multi indicator provides the trader with a collective or merged indication of these attributes, all reflected by this indicator as the height or distance the Pass Band, sin-wave, signal line is from the zero line (4). 

When a stock’s PBM indicator advances rapidly, moving far above or far below the zero line you are seeing stocks in a strong trend with strong momentum. This strength and correspondingly the momentum will diminish over time in the absence of new market motivating factors such as rumors, news or earnings.  As this occurs, the signal line will again drift down and approach the zero line even if the price has not moved against this most recent trend(5). This is a function of most oscillators and is referred to as detrending.   

The closer your trade comes to the zero line the more likely you are to see a reversal in the stock's price in the near future. The PBM signal moving inside the center band (gold lines/blue fill)(6) indicates to you that this upward momentum has neutralized and an exit may be required as the stock’s price approaches the zero line. If you have a strong convection of this stock’s long term potential, then you can hold the stock as long as the Pass Band signal does not move below the zero line. 

Stocks approaching the zero line, moving inside of the blue center band with gold boarders or tracking very near to the zero line indicate to traders that some action may be required by them to preserve capital in the near future.   Short signals are exactly the opposite of the above description.

Over extended prices are signaled by green or red background flags and periods of consolidation are flagged with gold a background color.

Pass Band Multi is an excellent indicator for any class of equity, but as you can see from the example chart, it is also an excellent crypto trading indicator.

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