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The Balance of Power (BOP) indicator was developed by a gentleman named Igor Livshin. The Balance of Power indicator compares the strength of buyers against sellers. It is a choppy indicator, so a Simple Moving Average is applied to it to help smooth some of the results.
The Balance of Power Indicator is calculated as follows:
BOP = SMA( Close - Open / High - Low )
The BOP's derived values fluctuate above and below a Zero-Line on a scale between -1 and 1.
When BOP is above the Zero-Line, or positive, this represents a bullish opportunity.
When BOP is below the Zero-Line, or negative, this represents a bearish opportunity.
