The Net Momentum Oscillator (NMO) is a variation on the Relative Strength Index(RSI). The RSI based on the ratio of up periods to down periods, while the NMO is the ratio of the momentum(ups-downs) to the absolute momentum(ups+downs).
The NMO is able to show overbought and oversold levels (greater than +50, less than -50) better than the RSI.
The NMO is developed by Tushar Chande and Stanley Kroll and is introduces in their article in May 1993 issue of “Technical Analysis of Stocks & Commodities” magazine.
Calculation:
If Price>PrevPrice then
Ups= Price - PrevPrice, Downs=0
else
Downs=PrevPrice - Price, Ups=0
Inputs:
Price Field = Close
Indicates Open, High, Low or Closing price.
Period = 14
Indicates time period(the number of days for daily analysis, the number of weeks for weekly analysis, etc.).
Indicator Type: Momentum