Advance Decline Index

A helpful instrument for discovering trend (bullish or bearish) in the share market  in which one divides the number of traded stocks that have increased in price by those which have dropped.

advance decline index

E . g ., if 2000 stocks have bullished and 1000 bearished on a specific day the A-D index is 2. Numbers greater than one indicate a bullish trend and lower than 1 indicate a bearish trend.

If the “share markets” are upwards but there are more decreasing stocks than advancing ones, it is normally a indication that the share markets are losing their breadth. If the number of improving issues are dominating the decreasing issues and the market is actually then considered healthy. If it’s decreasing, then a market isn’t healthy.

Technical analysts utilize the A-D index (advance-decline index) for a measure of breadth of market in order to decide the strength of market actions

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