Indicator Category: Woodward and Brown
Indicator Filter Fields: None
Indicator Report: No
An indicator developed by Ian Woodward to determine if a security is overextended or oversold. Values are computed by adding the % change values from each of the 17DMA, 50DMA and 200DMA to the high price of the day.
To evaluate when a market index, an industry group or a stock is getting over-extended (or under-extended) from a technical standpoint, Ian Woodward* uses his High Jump indicator.
The analogy is this: Just as a high P-E (which is at the outer limits of the historic range) is a warning sign to the fundamentalists and value investors that a stock is overbought or oversold, the peak values of the High Jump indicator are cautionary points of over-extendedness to technicians and high growth stock investors.
The indicator is called "High Jump" because its value lies in depicting the previous occasions in which a security has extended itself to peak values as measured from the high price to the 17 Day Moving Average, plus the 50 Day Moving Average, plus the 200 Day Moving Average. Added together, these respective percentage distances equal the High Jump Indicator value. Peak values represent the red caution flags when a stock or an index is obviously over-extended and due for a correction.