Advance/Decline Ratio: Volume Weighted MovAvg Difference

Abbreviation: Advance/Decline Ratio: VolWgtAvg Diff
Category: Market Advance / Decline
Input Parameters:

Name Range Default
Advancing Issues
Declining Issues
Total Volume
Avg1 Periods Int >= 1 5
Avg2 Periods Int >= 1 10

 
Calculation:

VolWgtAvg(X, Total Volume, VolWgtAvg1 Periods) – VolWgtAvg(X, Total Volume, VolWgtAvg2 Periods)

where
X = Advance/Decline Ratio(Advancing Issues, Declining Issues)

Advance/Decline Ratio represents Advance / Decline Ratio
VolWgtAvg represents Volume Weighted Moving Average

 
Discussion:

This indicator attempts to quantify movements in the Advance/Decline Ratio indicator by calculating the difference between two moving averages. Since it uses volume weighted moving averages (which give more importance to those periods with higher volume relative to the other periods in the moving average’s time frame), the indicator tends to focus more upon movement between periods of relatively higher volume than between periods of relatively lower volume.
 

Was this article helpful?

Related Articles