# LER - Law of Effort vs Results

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Law of Effort vs Results is a tool to find the price changes based on volume .

This tool shows that if there is a high volume occur but the price has small difference in one candle, this will trigger a 'spike'. This spike represents that a high activity has occurred but the price did not reflect as the volume changes.

The analogy of this tool can be represented as we drive a car on a steep hill: despite we hit the gas harder, the car just slightly move higher.
Note di rilascio: New update:

The previous release had a loophole, in which the spike has not triggered if a doji has occured (a doji simply means that the open price and close price are equal in one candle).

Since this algorithm use volume / price_difference, the doji will create the price difference becomes zero and lead to the infinity value.

To fix the doji issue, a bid offset has been added with default value of 0.005 (this default value was chosen based on the counter in stock exchange of Malaysia below MYR1).

## Commenti

Terima kasih Tuan!
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Terima kasih tuan,

nak tanya offset untuk kaunter atas RM1 dan RM10 nak guna berapa nilai offset ya?
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wcykoffbow
@wcykoffbow, by default, offset adalah 0.005 (atau 0.5 sen) sebab majoriti kaunter dalam Bursa adalah bawah RM1.

Walaupun begitu, untuk kaunter RM1 ke RM10 mempunyai bid sebanyak 0.01 (atau 1 sen), jadi boleh guna offset 0.01 untuk menggantikan offset default.

Cumanya, perbezaan offset 0.005 dan 0.01 tak nampak ketara sebab perbezaan yg sikit, dan offset 0.01 akan 'amplify' (atau 'boost') indicator tadi.

Perbezaan offset indicator ni hanya nampak ketara dalam 2 market yg mempunyai ratio matawang besar, contoh nya RM1 = 3500 rupiah.
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AmirZainol
@AmirZainol, baik tuan.jelas. terima kasih atas penerangan. semoga profit selalu
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Please be aware that the weakness of this tool is that the spike will not be triggered if doji happens (price close = price open = difference is 0).

This is due to the formula that the volume / price, so if price is zero, the result becomes infinity and violate the formula.
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AmirZainol
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