Accumulation/Distribution Line
The Accumulation/Distribution Line (A/D Line) is a technical indicator used in stock market analysis to measure the flow of money into and out of a security. It is calculated by adding the daily volume of a security to a running total, and then plotting the total as a line on a chart. The A/D Line is used to identify potential buying and selling opportunities in the market, as well as to confirm the strength of a trend.
History of the Accumulation/Distribution Line
The Accumulation/Distribution Line was developed by Marc Chaikin, a Wall Street analyst, in the late 1960s. Chaikin believed that the volume of a security was an important indicator of its future price movements. He developed the A/D Line to measure the flow of money into and out of a security, and to identify potential buying and selling opportunities. The A/D Line is still used today by technical analysts to identify potential trading opportunities.
Comparison Table
| Indicator | Accumulation/Distribution Line |
|---|---|
| Developed by | Marc Chaikin |
| Purpose | To measure the flow of money into and out of a security |
| Calculation | Adding the daily volume of a security to a running total |
| Used to identify | Potential buying and selling opportunities |
Summary
The Accumulation/Distribution Line (A/D Line) is a technical indicator used in stock market analysis to measure the flow of money into and out of a security. It was developed by Marc Chaikin in the late 1960s and is still used today by technical analysts to identify potential trading opportunities. For more information about the A/D Line, you can visit Investopedia, StockCharts, and TradingView.
See Also
- Relative Strength Index (RSI)
- Moving Average Convergence Divergence (MACD)
- On-Balance Volume (OBV)
- Price Volume Trend (PVT)
- Money Flow Index (MFI)
- Chaikin Money Flow (CMF)
- Force Index (FI)
- Ease of Movement (EOM)
- Negative Volume Index (NVI)
- Volume-Weighted Average Price (VWAP)
