Most investors rely on a few favorite stock market indicators, and new ones seem to pop up all the time, but the two most reliable ones for determining the strength of the market are price and volume. Most other stock market indicators are derived from price and volume data. So it stands to reason that if you follow the price and volume action on the major market indices each day, you will always be in sync with the current trend.

That said, secondary indicators can also help clarify the picture. Plots the number of advancing shares versus the number of declining shares. At times, a small number of larger weighted stocks may experience significant moves, up or down, that skew the price action on the index. This line, and its accompanying data, reveals whether a majority of stocks followed the direction of the major indexes on that day. Short Term Overbought — Oversold Oscillator.

Market Indicators

A day moving average of the number of stocks moving up in price less the number of stocks moving down in price for a specific exchange. Stocks with prices that did not change from the previous close are not included in this calculation. Some investors may use this indicator to take a contrarian position when the market has moved too in far in one direction over a short period of time.

Two day moving average lines are presented to illustrate the volume of all stocks on an exchange AMEX, NASDAQ, NYSE that are moving up or down in price. A day moving average of the total volume of all stocks on an exchange moving up in price.

A day moving average of the total volume of all stocks on an exchange moving down in price. When the two lines cross, this may indicate a trend change in favor of whichever line is moving up.

Two day moving average lines are presented to illustrate stocks reaching new highs and new lows, corresponding to their specific exchange AMEX, NASDAQ, and NYSE.

Released by the exchange, this is the ratio of all short interest on the NYSE exchange divided by the average daily volume.

However, when this ratio nears extreme levels it can be used as a contrarian indicator. Published by Investors Intelligence, this sentiment indicator is the result of a poll of market professionals. Just like most other sentiment indicators, this ratio can be used as a contrarian indicator when it nears extreme levels.

An economic calendar is a list of current and upcoming announcements for a variety of Economic Indicators.

It includes the period the announcement covers as well as the consensus estimate for each indicator, if available. The market tends to react favorably when positive numbers are reported.

World's Wackiest Stock Indicators

Keep in mind that the market may have already priced in the result of the announcement based on the consensus estimate prior to the announcement. Thus, when the reported numbers fall short of the consensus estimate, the market may react unfavorably. There are many other sentiment indicators that attempt to capture how market participants feel about the current environment.

They all tend to work with varying degrees of success in particular situations, but the best indicators for portraying actual market strength are the ones directly derived from actual market price and volume data. Here are a few other sentiment indicators to consider for market directional analysis:. Your pop-up blocker may be preventing MarketSmith charts from opening. Click here for instructions to solve this issue. Incorporated unless otherwise noted.

We will send you a link to create a new password. ToggleForgotPassword ; break; case 'signinattempt': Stock Market Stock Market Indicators Stock Market Trends Stock Market Historical Data Stock Market Research Tools Stock Charts. Primary Indicators Most investors rely on a few favorite stock market indicators, and new ones seem to pop up all the time, but the two most reliable ones for determining the strength of the market are price and volume. What is a short position?

Two indicators on market direction - MarketWatch

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