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Air Products and Chemicals (APD) Stochastic Momentum Gauge in Focus

June 13, 2019 / Charles Wolfe

Investors are delving into the details on shares of Air Products and Chemicals (APD).  The share price has climbed the ladder moving past the Stochtastic Momentum Index of +40, indicating possible overbought territory. The Stochastic Momentum Index, or SMI, is a more refined version of the original stochastic oscillator, employing a wider range of values and having a higher sensitivity to closing prices. The Stochastic Momentum Index (SMI) indicator was developed by William Blau and is based on the Stochastic indicator. The Stochastic oscillator is calculated using the close price relative to the high low trading range, whereas the Stochastic Momentum Index indicator is calculated using the close price relative to the midpoint of the high low trading range. The most common method of using SMI is to look for buy trades when the SMI falls under -40 and then rises back above through -40.  Sell trades are looked for when the SMI rises above +40 and then falls back below +40.