Categories: Trading

Advance-Decline Data

Advance-Decline data is a market breadth indicator used in technical analysis to measure the number of stocks advancing or declining in a particular market. It provides insight into the overall market sentiment and can be used to confirm the strength of a market trend.

How to calculate Advance-Decline Data?

To calculate Advance-Decline data:

Count the number of stocks that have advanced (closed higher) on a given day.

Count the number of stocks that have declined (closed lower) on a given day.

Subtract the number of declining stocks from the number of advancing stocks to obtain the Advance-Decline (A/D) line.

How to interpret Advance-Decline Data?

A positive Advance-Decline line indicates that more stocks are advancing than declining and is considered a bullish sign, while a negative Advance-Decline line suggests that more stocks are declining and are considered bearish. The Advance-Decline line can be plotted along with the market index to provide further insight into market sentiment.

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