Market Internals 003 – Advance Decline Line
The Advance/Decline Line or ‘A/D Line’ for short, is the second most important of the internals. This indicator tells us the net sum of advancing stocks minus declining stocks.
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The Advance/Decline Line or ‘A/D Line’ for short, is the second most important of the internals. This indicator tells us the net sum of advancing stocks minus declining stocks.
The Breadth Ratio is a volume ratio composed of volume flowing into up stocks versus volume flowing into down stocks. This reading is important in relation to where it has been, especially where we are now compared to where we opened on the day.
Market Internals are similar to the instrument cluster on your car, without them you really do not know the condition of the market environment or how fast you are moving.
If you could only use one indicator, which one would you choose?
Find out what my favorite indicators are, as well as other traders are saying on the blog.
The number one way new traders fail is by counting the money that could be made on the trade when they should be focusing on how much they could lose on the trade.
To succeed you must be able to accept the risks and apply money management techniques such as stop loss orders, max daily loss limits, and account draw down rules.
We’ve all heard the saying…
“The trend is your friend until the end”
In this post I outline techniques for identifying the trend, getting in, and staying in until it fails.