high volumes, which in many cases happen on margin (all you day traders out there). So, why would the two indicators diverge if they are both volume based? Then we need to calculate the MFV: MFV MFM x Volume on the Period.
Accumulation/distribution is a momentum indicator that attempts to gauge supply an d demand by determining whether investors are generally buying.
The accumulation/distribution line was created by Marc Chaikin to determine the fl ow of money into or out of a security.
It should not be confused with the.
Forex Trading Strategy The Significance of Open Interest ».
In this manner, the respective security is likely to decrease in price. Now stocks, of course, have readily available volume data. Narrow and short accumulation zones, followed by a strong breakout, are more meaningful. ADL Divergence The ADL divergence is another very important feature of the accumulation/distribution indicator. Supply and demand drives forex séances heures all price discoveries, from local flea markets to international capital markets. The origin of a bearish trend wave is called a distribution or a supply zone. If the volumes are high, then the price action is likely to create a big candle on the chart. What the A/D indicator actually measures. To determine the right place for your S/L order, you should use the price action rules.
How to read market phases - accumulation, participation, distribution
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