Typical Price

Typical Price is another approximation of average price for each period and can be used as a filter for moving average systems.

Calculated as:     (High + Low + Close) / 3

Typical Price is a component of the Money Flow Index and Commodity Channel Index.

Example

Intel is shown with 21-day exponential moving average (MA) and Typical Price (TP), used as a filter.

Mouse over chart captions to display trading signals.

Using the Single Moving Average System, note how many times you would have been whipsawed in/out of your position when price crosses the MA.

Compare this to the long [L] and short [S] signals when Typical Price is used as a filter.

The days marked are signal days. A trade would be entered on the next day.

Setup

See Indicator Panel for directions on how to set up an indicator.