The Accumulation/Distribution Volume indicator (A/D) is an oscillator to measure price change based the volume, which is a weighting coefficient of price. Higher the volume, higher the coefficient is thus giving more weight to the price change. The accumulation/distribution is an oscillator and is used to confirm price changes (based on volume) and works similar to the On Balance Volume indicator.
When the Accumulation/Distribution indicator rises, it indicates a rise in buying or accumulation and when the Accumulation/Distribution indicator declines, it points to a period of falling prices. There are no additional settings for this indicator. It can be commonly used to spot divergences between price to identify weakening trends and momentum. The accumulation/distribution indicator and gives insights into the bulls and bears commitment which is spotted by the divergences that are formed. While the indicator is used in the forex markets, it is a better gauge when applied to equities as the volume is more accurate compared to the volumes in forex.
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