Accumulation Distribution is an enhancement of the On Balance Volume indicator. It first compares opening and closing prices to the trading range for the period, the result is then used to weight the volume traded.

Please note that Wilder does not use the standard moving average formula and the time period may need adjustment.

Bollinger Bands are calculated at a specified number of standard deviations above and below the moving average, causing them to widen when prices are volatile and contract when prices are stable.

Bollinger originally used a 20 day exponential moving average and set the bands at 2 standard deviations, suited to intermediate cycles.

Candlesticks contain the same data as a normal bar chart but highlight the relationship between opening and closing prices. The narrow stick represents the range of prices traded during the period (high to low) while the broad mid-section represents the opening and closing prices for the period.

• If the close is higher than the open - the mid-section is hollow or shaded blue/green.
• If the open is higher than the close - the mid-section is filled in or shaded red.

Chaikin Money Flow

Chaikin Money Flow is based on the observation that buying support is normally signalled by increased volume and frequent closes in the top half of the daily range. Likewise, selling pressure is evidenced by increased volume and frequent closes in the lower half of the daily range. 

Chaikin Money Flow is calculated by summing Accumulation Distribution for 21 periods and then dividing by the sum of volume for 21 periods.

The Chaikin Oscillator is calculated by subtracting a 10 period exponential moving average from a 3 period exponential moving average of the Accumulation Distribution line.

Chaikin Volatility should be used in conjunction with a moving average system or price envelopes.

The Commodity Channel Index was developed by Donald Lambert and is outlined in his book Commodities Channel Index: Tools for Trading Cyclic Trends.

Price Comparison plots the closing price of a second stock (or index) onto the price chart. The scale of the second stock (or index) is adjusted so that both price lines commence at the same point.

Although often late, the Coppock Indicator has produced very reliable signals in the past.

Most indicators have one major weakness - they are not suited for use in both trending and ranging markets. The key feature of the Directional Movement System is that it first identifies whether the market is trending before providing signals for trading the trend.

Directional Movement System measures the ability of bulls and bears to move price outside the previous day's trading range. The system consists of three lines:

• The Positive Direction Indicator (+DI) summarizes upward trend movement;
• The Negative Direction Indicator (-DI) summarizes downward trend movement; and
• The Average Directional Movement Index (ADX) indicates whether the market is trending or ranging.

The indicator shows:

• high positive values when prices move upward on light volume;
• high negative values when prices move down on light volume;
• low values if price is not moving or if it takes heavy volume to move prices, signalling distribution or accumulation.

Dr Elder uses a 13-day exponential moving average (EMA) to indicate the market consensus of value. Bull Power measures the ability of buyers to drive prices above the consensus of value. Bear Power reflects the ability of sellers to drive prices below the average consensus of value.

Bull Power is calculated by subtracting the 13-day EMA from the day's High. Bear power subtracts the 13-day EMA from the day's Low.

The length of the moving average should be varied according to the cycle that you are trading. 

The Percentage should be set so that about 90% of price activity is contained within the bands. Adjust the band width if volatility increases over time.

Equivolume was invented by Richard W Arms Jr. and introduced in his book Volume Cycles in the Stock Market.

• The 2-day EMA of Force is used to track the strength of buyers and sellers in the short term;
• The 13-day EMA of Force measures the strength of bulls and bears in intermediate cycles.

If the Force index is above zero it signals that the bulls are in control. Negative Force index signals that the bears are in control. If the index whipsaws around zero it signals that neither side has control and no strong trend exists.

• The higher the positive reading on the Force index, the stronger is the bulls' power.
• Deep negative values signal that the bears are very strong.
• If Force index flattens out it indicates that either (a) volumes are falling or (b) large volumes have failed to significantly move prices. Both are likely to precede a reversal.

The 2-day Force index is used as part of Dr Eder's Triple Screen trading system.

The indicator is primarily used to trade trends and should not be used in a ranging market.

MACD was developed by Gerald Appel and is discussed in his book, The Moving Average Convergence Divergence Trading Method

Only trade with Histogram signals when the market is trending.

The MACD Histogram can also be used to track longer cycles, using weekly or monthly data.

The Mass Index was invented by Donald Dorsey.

Median Price

Calculated as:             ( High + Low ) / 2

The line is plotted on the price chart and can be used as a filter for trend indicators.

Median Price is featured in Steven Achelis' book, Technical Analysis A-Z.

High Momentum readings (positive or negative) occur when a trend is at its strongest. Lower readings are found at the start and end of trends.

Overbought and oversold levels are set separately for each security, based on the performance of the indicator over past cycles.

The length of the moving average should be varied according to the cycle that you are trading. See Moving Averages for details. 

The Percentage should be set so that about 90% of price activity is contained within the bands. Adjust the band width if volatility increases over time.

Shorter length moving averages (MA's for short) are more sensitive and identify new trends earlier, but also give more false alarms. Longer moving averages are more reliable but only pick up the big trends.

It is best to use a moving average that is half the length of the cycle that you are tracking. If the peak-to-peak cycle length is roughly 30 days then a 15 day MA is appropriate. If 20 days, then a 10 day MA is appropriate. You will, however, often find traders using 14 and 9 day MA's for the above cycles in the hope that they will generate signals slightly ahead of the market.

Negative Volume Index is based on days when volume is down from the previous day. Positive Volume Index is based on days when volume is up on the previous day. 

On Balance Volume attempts to measure the level of accumulation or distribution by comparing volume to price movements. Volume is added to the indicator if closing price moves up and subtracted if closing price moves down. No adjustment is made if closing price is unchanged.

Parabolic SAR should only be employed in trending markets - when it provides excellent entry and exit points. It is plotted in a rather unorthodox fashion: a stop loss is calculated for each day using the previous days data. The advantage is that the stop level can be calculated in advance of the market opening.

• A stop level below the current price indicates that your position is long. The stop will move up every day until activated (when price falls to the stop level). 
• A stop level above the current price indicates that your position is short. The stop moves down every day until triggered (when price rises to the stop level).

By convention, the first X in a column is plotted one box above the last O in the previous column (and the first O in a column is plotted one box below the highest X). 

Positive Volume Index is based on the assumption that the uninformed crowd dominates trading on active days. Negative Volume Index assumes that the smart money dominates trading on quiet days.

Positive Volume Index highlights days when volume is up on the previous day. Negative Volume Index highlights days when volume is down. 

Price Comparison plots the closing price of a second stock (or index) onto the price chart. The scale of the second stock (or index) is adjusted so that both price lines commence at the same point.

The length of the moving average should be varied according to the cycle that you are trading. See Moving Averages for details. 

The Percentage should be set so that about 90% of price activity is contained within the bands. Adjust the band width if volatility increases over time.

The length of the moving average should be varied according to the cycle that you are trading. See Moving Averages for details. 

The Percentage should be set so that about 90% of price activity is contained within the bands. Adjust the band width if volatility increases over time.

The length of the moving average should be varied according to the cycle that you are trading. See Moving Averages for details. 

The Percentage should be set so that about 90% of price activity is contained within the bands. Adjust the band width if volatility increases over time.

The indicator is designed for use in ranging markets - to detect trend weakness and likely reversal points. However, when combined with a trend indicator, it can be used in trending markets.

ROCV highlights increases in volume, which normally occur at most significant market tops, bottoms and breakouts

Price Ratio is calculated by dividing the closing price of the first stock by the second.

Unlike Price Comparison, Price Ratio is plotted in a separate indicator panel. 

The Relative Strength Index compares upward movements in closing price to downward movements over a selected period. Wilder originally used a 14 day period, but 7 and 9 days are commonly used to trade the short cycle and 21 or 25 days for the intermediate cycle. Please note that Wilder does not use the standard moving average formula and the time period may need adjustment.

Relative Strength Index is smoother than the Momentum or Rate of Change oscillators and is not as susceptible to distortion from unusually high or low prices at the start of the window. It is also formulated to fluctuate between 0 and 100, enabling fixed Overbought and Oversold levels.

• Because of the smoothing the indicator is less erratic and gives fewer false signals;
• The exponential moving average ensures that the indicator only "barks" once. 

Smoothed Rate of Change (SROC) first calculates a 13-day exponential moving average of closing price. Then calculate a 21-day Rate of Change of the exponential moving average.

The indicator consists of two lines:

• %K compares the latest closing price to the recent trading range.
   
• %D is a signal line calculated by smoothing %K.

Based on a triple-smoothed moving average of Closing price, the indicator eliminates cycles shorter than the selected indicator period. Triple smoothing reduces volatility and minimizes the chance of false signals shaking you out of a trend too early.

TRIX was developed by Jack Huton, publisher of (Technical Analysis of) Stocks and Commodities magazine.

Twiggs Money Flow warns of breakouts and provides useful trend confirmation. It is based on the observation that buying support is normally signalled by: 

• increased volume and 
• frequent closes in the top half of the daily range. 

Likewise, selling pressure is evidenced by:

• increased volume and 
• frequent closes in the lower half of the daily range

Calculated as:      (High + Low + Close) / 3

Vary the number of periods in the Vertical Horizontal Filter to suit different time frames. White originally recommended 28 days but now prefers an 18-day window smoothed with a 6-day moving average.

Volatility is normally used to measure the risk profile of managed funds.

Designed to highlight breakouts from a trading range, this VR compared to true range for the indicator period

The Volume Oscillator measures the difference between a faster and slower moving average (MA). 

• If the fast MA is above the slow MA the oscillator will be positive. 
• If the fast MA is below the slow MA then the oscillator will be negative. 
• The Volume Oscillator will be zero when the two MA's cross

Weighted Close is calculated as:      (High + Low + Close * 2 ) / 4

Weighted Close is featured in Steven Achelis' book, Technical Analysis A-Z.

Williams Accumulate Distribute, Achelis' version, is not a volume indicator despite the name. It is a cumulative  measure of trading range for each period.

Williams Accumulate Distribute is traded on divergences. When price makes a new high and the indicator fails to exceed its previous high, distribution is taking place.  When price makes a new low and the WAD fails to make a new low, accumulation is occurring.

The original indicator was created by Larry Williams

Williams Accumulation Distribution was created by Larry Williams.

The indicator is very similar to Stochastic %K - except that Williams %R is plotted using negative values ranging from 0 to -100. Details of the formula can be found under Construction. 

The number of periods used to calculate Williams %R can be varied according to the time frame that you are trading. A rule of thumb is that the indicator window should be half the length of the cycle (14 days is popular for the intermediate cycle).

Overbought and Oversold levels are normally set at -20 and -80.