Subscribe Now!  
  Email Us     Take Tour  
  Login     About  

Market SummaryToday's GaugesChartsUser's Guide IndexHistorical GaugesHelp Table of Contents
Help on this page Chart on this IndicatorNASDAQ 5 Day Advance/Decline OscillatorNASDAQ 12 Day Advance/Decline Oscillator

NASDAQ 3 Day Up/Down Volume Ratio

Description | Calculation | Strategy | View Chart

Time Frame: Short
Category: Momentum

Description

Each day the breadth of the market can be measured by subtracting the number of declining stocks from the number of advancing stocks. A large positive number indicates a strong day, while a negative result represents a weak day. This daily breadth number is the foundation for the calculation of numerous market momentum indicators. The internal strength of the market can also be monitored by tracking the volume in rising stocks relative to the volume in those falling. Understanding the dynamics of the internal market can help identify when the market trend is likely to change its course.

Calculation & Significant Levels

OTC 3-Day Up/Down Volume Ratio: A three-day moving average of the daily up/down volume value. The formula for the daily value is up volume divided by the sum of up volume and down volume.
0verbought is >70% and oversold is <30%.

Formula:                        (up volume)
     Three-day average of ------------------------
                          (up volume + down volume)

Gauge Elements: Magnitude, Time, Slope
Updated: Daily

Strategy

The short-term internal momentum of the market often turns prior to the price changing trend. This momentum indicator should be used with the strength of the longer term trend in mind. Each of these ratios should be viewed as a part of one whole indicator. The 5-day advance/decline value should be confirmed by the 3-day up/down volume value. The 12-day advance/decline value should be read in conjunction with the 5-day up/down volume value. The market may be over-extended when any one of these ratios are overbought or oversold, but it is most significant when the ratios confirm one another and change their trend in an over-extended area. Historically, when three or four of the ratios reached an extreme and all turned within a two week time span, the market's trend changed. In a strong trending market it is common to see the 3-day advance/decline value become overbought and reverse while the price continues its trend. This pattern is more significant when the 12-day advance/decline value and the volume ratios subsequently become extended and reverse in warning levels. The indication is even stronger if both the NYSE and NASDAQ have the same internal momentum patterns developing.


Return to Top
Home  |  MarketGauge  |  HotSpots  |  Portfolios
Market Summary  |  Today's Gauges  |  Charts  |  User's Guide Index  |  Historical Gauges  |  Help
Email/Contact Us  |  Sign Up  |  Login  |  Site Map  |  About
Click here to send us your questions and comments.

MarketGauge ® by DataView, LLC
All data is end of day. All times are EST.
All data in MarketGauge is subject to the DataView, LLC. MarketGauge User Agreement.
Market sector and industry group classifications are provided by Market Guide.
MarketGauge is a Registered Service Mark of DataView, LLC.
Patent Pending, Copyright 1999-2002 DataView LLC. All Rights Reserved.