Force Index
The Force Index focuses on three key pieces of market information -- price change, extent of price change and trading volume.
Study Type: Stand-alone
Description
The force of every move is defined by its direction, distance, and volume. If prices close higher, the force is positive, if lower, then negative. The greater the change in prices, the greater the force. The greater the volume, the greater the force. That is the simple but powerful concept behind Force Index.
Formula
The Force index is calculated by subtracting yesterday's close from today's close, then multiplying by volume.
Parameters
- Period: (13) - the number of bars, or period, used to calculate the study.