We’ve already explained how we calculate relative strength readings for securities and how we plot those readings onto point and figure charts. In this video, Tim explains how to interpret a point and figure relative strength chart.
Unlike point and figure trend charts, patterns do not matter on point and figure relative strength charts. We won’t be looking for bullish catapults or shakeout patterns here.
When it comes to relative strength, we only care about two chart characteristics:
– Is the chart in a column of X’s or O’s?
– Is the chart on a buy signal or a sell signal?
In a future video, we will discuss the significance of columns and signals as they pertain to point and figure relative strength charts.