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Introducing Column Analysis feature

Post in "Zone Web" Started By Definedge, 12th August 2022

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Introducing Column Analysis | RZone 

Column analysis scanner helps in understanding the P&F column distribution of any instrument.

P&F column represents swing moves. Have you ever wondered what is the average length of columns in any stocks? For example, I see a stock having 10 boxes in the column. The question is, how many times in the past the stock has reversed after 10 boxes in the column? How many times the stock has produced large columns? This question has led us to build the new screener that can help us understand the column length distribution of any stock in the past.

Where to find?

Go to P&F Smart Scanners -> Column Analysis scanner in RZone

Select Scrip name, box-size and reversal size in the dialogue box.

There are two other fields: Column Length Range and Distance.

Column length

Define the range of the column length. Default values are 3 to 50. It means the number of boxes in the column to be considered in the calculation are from 3 boxes in a column up to 50 boxes in the column.

For example, how many times the stock had 3 boxes in the column in past. How many times 4 boxes and so on.  

Distance

It may not be always useful to see the data of columns having 3 boxes, 4 boxes 5 boxes and so on. We can make a group. For example, boxes in the column between 3 to 8 – the distance is 5 in this case. The boxes in the column between 3 to 10 – the distance is 7 in this case. This way, you can define the distance.

So, when you put column length range as 3 to 50 and distance as 5, the data will show you how many time the column in the stock has been between:

  • 3 to 8 boxes
  • 8 to 13 boxes
  • 13 to 18 boxes
  • 18 to 23 boxes
  • 23 to 28 boxes
  • 28 to 33 boxes
  • 33 to 38 boxes
  • 38 to 43 boxes
  • 43 to 48 boxes
  • More than 48 boxes

Check below data for the Reliance

Green bars show the length of column of Xs (Bullish swings) in that range and red bar shows the length of column of Os (Bearish swings).

In first bars, it shows how many times the boxes in the column have remained between 3 and 8. In the second, it shows how many time the boxes have remained between 8 and 13. In third, it shows how many times they were between 13 and 18 and so on.

For the Reliance, Tall bars in the column length between 8 – 13 and 13 – 18 shows that the swing move in the stock tends to remain in this range.

See below data for Tata Steel.

The Tata stell also have tall bars at 8 and 13 lengths but it has also got some good tall bars for column range above 48. That means the stock tends to produce large swings without even a column reversal.

See below data for Reliance for Column length between 3 to 20 with distance 1 for 3% box-value.

3% box-value = Long-term

Distance 1 = Number of columns for each box length between 3 to 20 columns

The data shows that the stock hardly moves beyond 11 boxes in a column on this box-value.

It mostly remans up to 5 boxes in the column.

This data can be a very helpful tool from the trading perspective. It can help you know the tendency of the instrument and plan the strategies. Some stocks are slow movers, the column reversal strategies can prove very helpful in them. Some stocks produce large swings, the breakout strategies can prove very effective in them.

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