How can we help you today?


Accumulation/Distribution

Marc Chaikin created the Accumulation/Distribution (AD), a volume indicator that attempts to associate changes in price with volume. It is designed to assess the cumulative flow of money into and out of a security. The premise of the indicator is that the more volume supporting a price move, the more significant the price move is said to be. A bullish signal is given when the AD Line forms a positive divergence.

The AD Line can also be used to confirm the strength behind an advance in share price. If the AD Line remains up or at least moves in an uptrend, then the advance in price is considered solid. If the stock is moving up, but the AD Line fails to make higher highs or starts going sideways, then it is said that buying pressure is weak and support should fail.

Have more questions? Submit a request
Powered by Zendesk