|The Detrended Price Oscillator
("DPO") attempts to eliminate the trend in prices. Detrended prices allow you to
more easily identify cycles and overbought/oversold levels.To calculate the DPO, you
specify a time period. Cycles longer than this time period are removed from prices,
leaving the shorter-term cycles.
To calculate the
Detrended Price Oscillator, first create an n-period simple moving average (where
"n" is the number of periods in the moving average).
Now, subtract the moving average "(n / 2) + 1"
days ago, from the closing price. The result is the DPO.
DPO = Close (Moving Average
"((n/2)+1)" days ago)
The DPO would be shown the same way as the moving average
graph where the user can provide the value of n.