Once again, MarketVolume® is one step ahead of the competition. Right now, our development team put the finishing touches on our new Indexes charts. MarketVolume® is the only source of real-time intraday index volume and advance / decline charts for major US indexes and exchanges. Now, we are raising the bar even further. From now on you may monitor Advance Decline Line for U.S. indexes and Exchanges.
Advance Decline Line
Advance Decline Line is one of the well known breadth indicator in technical analysis. Initially Advance Decline Line (AD Line) has been applied to NYSE (New York Stock Exchange), yet, we are the first who started to provide this technical indicators for other indexes and exchanges which allows to use AD Line to analyze smaller stock market sectors.
As with all other breadth indicators AD line could be applied to the basked of stocks only and is based on the Advance/Decline Issues, however we are the first who started to apply the Advance Decline Line formula to volume of advances and declines as well as we are first who started to monitor AD Line on intraday charts.
Below you may see the S&P 500 advance decline line and advance decline volume line.
Chart 1: S&P 500 index - Advance Decline Line.
TRIX and TRX 2 Line
TRIX displays the percent rate-of-change of a triple exponentially smoothed moving average of a security's closing price in order to eliminate price movements that are insignificant to the larger trends by reducing price volatility.
Below you may see S&P 500 60-day (1 bar = 1 hour) chart example of using TRIX indicator in hypothetical trading system that generates "Buy/Sell Signals" on crossovers of TRIX and zero line around which TRIX oscillates.
Chart 2: S&P 500 index - TRIX.
Another way of using TRIX is to use it with "Signal Line". On the chart below (see chart #2) you may see example of TRIX trading system that generates signals on TRIX and "Signal Line" crossovers.
Chart 3: S&P 500 index - TRIX 2 line (Signal Line).
If you compare chart #1 to the chart #2, you may notice that with the same setting the second trading system is more sensitive and may earlier spot trend reversals. However at the same time the second trading system would generate more signals and as a result probability of fake signals is higher. Furthermore depending on the trading style one trader may prefer using TRIX while other may select TRIX with "Signal Line".
Standard Deviation
The Standard Deviation is used in technical analysis and trading systems to measures stock's volatility statistically by showing the difference of the prices from the average one. Normally, this indicator is used as a constituent of other indicators.
One of use of the Standard deviation is to confirm the down-trend and up-trend. As a rule, during the up-trend the market is less volatile while during the downtrend and market crashes we may witness high volatility which is caused by panic selling.
In trading systems Standard Deviation (as other volatility indicators) is used to define periods of the volatility and adjust used technical indicators setting to it. It is well know that in high volatile market the price trend changes faster and trading system should react on the signals faster, otherwise it could be too late to open/close a trade. At the same time in low volatile market a trader may set the trading system to generate signals with delay to avoid situation of premature opened/closed trades.
Chart 4: S&P 500 index - Standard Deviation.
