Learn to Trade Stocks
Technical Indicators Archive
-
On-Balance Volume
ON-BALANCE VOLUME price-volume relationship Based on a cumulative volume, the on-balance volume relates price and volume in the stock market, and it has the formula: OBV = OBVprev + volume … if close > closeprev then { + volume} + 0 … if close = closeprev then { + 0} - volume … if close [...] -
Money Flow
MONEY FLOW price times volume Money flow approximates the dollar value of a certain day’s trading. The formula is price multiplied by volume. Generally, a value of 80 is counted as overbought while a value of 20 is considered as oversold. Differences in the MFI (money flow indicator) and price action are significant. If the [...] -
Trix Indicator
TRIX INDICATOR price times volume The Trix Indicator (TI) shows the slope of a triple-smoothed exponential moving average. The term Trix is actually a shortcut of “triple exponential” and was developed by Jack Hutson in the 1980s. Given an n-day period, trix is calculated this way: • Smooth closing prices using an N-day exponential moving [...] -
Stochastic Oscillator
STOCHASTIC OSCILLATOR (SO) a momentum indicator that uses support and resistance levels Calculations Dr. George Lane promoted this indicator in the 1950s. “Stochastic” refers to the location of a current price in relation to its price range over a period of time. This method attempts to predict price turning points by comparing the closing price [...] -
Relative Strength Index (RSI)
RELATIVE STRENGTH INDEX (RSI) a momentum oscillator J. Welles Wider developed the RSI and published it in a 1978 book, “New Concepts in Technical Trading Systems”. It was also published in Commodities magazine (now Futures magazine) in June of the same year. Purpose The RSI is used as a trading indicator in the technical analysis [...] -
Parabolic SAR
PARABOLIC SAR (PS) used to find trends in market prices and securities J. Welles Wilder Jr. devised the Parabolic Stop and Reverse (SAR) to find trends in market prices or securities. The method can be used as a trailing stop loss based on prices tending to stay within a parabolic curve during a strong trend. [...] -
MACD – Moving Average
MOVING AVERAGE CONVERGENCE/DIVERGENCE (MACD) a lagging indicator that is also a form of Absolute Price Oscillator Definitions Gerald Appel developed MACD as a technical analysis indicator in the late 1970s. MACD shows the difference between a fast and slow exponential moving average (EMA) of closing prices. MACD is a type of Absolute Price Oscillator (APO). [...] -
Commodity Channel Index
COMMODITY CHANNEL INDEX (CCI) used in identifying cyclical trends in commodities, equities and currencies Donald Lambert introduced the CCI (an oscillator) in an article published in the October 1980 issue of Commodities magazine (now known as Futures magazine). Since its introduction, the indicator has become very popular and is now a very common tool for [...] -
Average Directional Index
AVERAGE DIRECTIONAL INDEX (ADX) an indicator of trend strength J. Welles Wilder created the Average Directional Index in 1978 as an indicator of trend strength in a series of prices of a financial instrument. ADX has been used widely as an indicator by technical analysts. It is provided as a standard in collections of indicators [...] -
Advance Decline Line
ADVANCE DECLINE LINE (ADL) measures the number of individual stocks participating in a market rise or fall Definition The ADL is a stock market indicator used by speculators to measure the number of individual stocks participating in a market rise or fall. Price changes of large stocks can have a disproportionate effect on capitalization weighted [...]