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What is Accumulation/Distribution Stock Indexes Indicator?


Accumulation/Distribution Indices indicator - Accumulation/Distribution technical indicators is a popular stock indices indicator that can be found on the - Indices Indicators List on this website. Accumulation/Distribution stock indices indicator is used by stock indexes traders to predict stock indexes price movement based on the chart stock indexes price analysis done using this Accumulation/Distribution indicator. Indices traders can use the Accumulation/Distribution buy and Sell Indices Trading Signals explained below to determine when to open a buy or sell indices trade when using this Accumulation/Distribution indicator. By using Accumulation/Distribution and other stock indices indicators combinations traders can learn how to make decisions about market entry and market exit.



What is Accumulation/Distribution Indices Indicator? Accumulation/Distribution Indices Indicator



Adding a Indices Indicator to Accumulation/Distribution Stock Indexes Indicator in MetaTrader 4


Which Stock Indexes Indicator to Combine with Accumulation/Distribution?

Which is the best Accumulation/Distribution Indices technical indicator combination for stock indexes trading?



The most popular indicators combined with Accumulation/Distribution are:

  1. RSI

  2. Moving Averages

  3. MACD

  4. Bollinger Bands

  5. Stochastic Oscillator

  6. Ichimoku

  7. Parabolic SAR


Which is the best Accumulation/Distribution indicator combination for stock indexes trading? - Accumulation/Distribution MetaTrader 4 stock indices indicators


What are the best trading indicators to combine with Accumulation/Distribution?

Find additional indicators in addition to Accumulation/Distribution indicator that will determine the indices trend of the stock indexes trading market as well as others that confirm the stock indexes trading market trend. By combining stock indices indicators that determine indices trend and others that confirm the indices trend and combining these indicators with Indices Trading Accumulation/Distribution indicator a indices trader will come up with a Accumulation/Distribution based indices trading system that they can test using a indices trading practice demo stock indexes trading account on the MetaTrader 4 stock indexes trading platform.



This Accumulation/Distribution based stock indices trading system will also help stock indexes traders to determine when there is a market reversal based on the stock indexes indicators signals generated and therefore traders can know when to exit the stock indexes market if they have open trades.



What is Accumulation/Distribution Stock Indexes Indicator Based Trading? Indicator based stock indexes trading system to analyze the stock indexes price and provide trade signals.


Accumulation/Distribution Indices Trading Strategy?



How to Choose the Best Accumulation/Distribution Indices Trading Strategy

For traders researching on What is the best Accumulation/Distribution indices trading strategy - the following learn indices trading tutorials will help traders on the steps required to guide them with coming up with the best strategy for trading Indices Trading market based on the Accumulation/Distribution indicator stock indexes trading system.

Best Indices Indicators Combination for Accumulation/Distribution




About Accumulation/Distribution Indices Indicator Tutorial


Accumulation/Distribution Indices Technical Analysis and Accumulation/Distribution Indices Trading Signals

Developed by Marc Chaikin


This indicator is used to assess the cumulative flow of money into and out of indices.


Originally used for stocks trading, when it comes to stocks trading “volume” is the amount of shares traded in a particular stock, this volume is a direct reflection of the money that is coming into and out of a stock.


The basic principle behind AD is that volume(or money flow) is a leading indicator of the indices price. (Volume precedes indices price).



Tick volume is the measure of stock indexes price changes (ticks) received by a indices broker during a particular trading period/interval. The tick volume is incorporated by many indices brokers in their charting software.


Interpretation


This volume indicator is used to determine if volume is increasing or decreasing as the stock indexes price on a stock indices chart is rising or falling.


Uptrend

If the stock indexes price on a stock indices chart is rising then the Accumulation/Distribution should also be rising. This shows that the stock indexes price move is being supported by volumes and the move upwards has strength and is sustainable.


If on the other hand stock indexes price is moving up and the volumes are not, the strength behind the move is reducing; this creates divergence between stock indexes price and indicator and warns of a possible move in the opposite direction.


Downtrend

If the stock indexes price on a stock indices chart is falling then the AD should also be falling. This shows that the stock indexes price move is being supported by volumes and the move downwards has strength behind it.


If on the other hand stock indexes price is moving down and the volumes are not, the strength behind the move is reducing; this creates divergence between stock indexes price and AD and warns of a possible move in the opposite direction.



Indices Technical Analysis and Generating Indices Trading Signals


Below is an example of a stock indices chart and the technical analysis explanation

Accumulation\Distribution Indices Indicator

From the chart above we can separate the chart into three parts, part A, B and C.


A - Upward indices trend line on chart as well as on the Accumulation/Distribution

B - Downward indices trend line on chart as well as on the Accumulation/Distribution

C - Upward indices trend line on chart as well as on the Accumulation/Distribution


As long as the stock indexes price and the indicator are moving in the same direction then the stock indexes price move has enough momentum to continue moving in that direction as shown above


Broker


Indices Trend Line Break

From the above chart we can see that once the indices trend line on the AD was broken then the stock indexes price indices trend line was also broken.


Looking at the chart below we have added vertical lines to represent the points where the indices trend lines were broken, both on the stock indexes price chart and the indicator.


Comparing the indices trend lines on the indicator and the stock indexes price those of the AD were broken before those of the chart. This is because volume always precedes indices price.


Indices Trend Line Break- Technical Analysis of Accumulation\Distribution indicator



Trading signals

Exit

Exit signals are generated when the indices trend line on the Accumulation/Distribution is broken. A indices trend line break on the indicator warns of a possible reversal.

Exit Signal


Entry

Once the indices trend line on the AD is broken it warns of a possible reversal in the direction of the stock indexes trading market.


However if we want to take a trade in the opposite direction it is always best to wait for a confirmation signal.


A confirmation signal is considered complete once both the indicator and the stock indexes price breaks both their indices trend lines.

Entry Signal - Generated by Indices Trend Reversal

Entry Signal Generated by Indices Trend Reversal

 

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