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Indicator Help

Indicator Index
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  1. Accumulation / Distribution
  2. Aroon Oscillator *
  3. Aroon Up/Down *
  4. Average Directional Index
  5. Average True Range
  6. Bollinger Bands
  7. Bollinger Band Width *
  8. Chaikin Money Flow Index *
  9. Chaikin Oscillator *
  10. Chaikin Volatility *
  11. Close Location Value *
  12. Commodity Channel Index
  13. Detrended Price Oscillator *
  14. Donchian Channel *
  15. Donchian Channel Width *
  16. Ease of Movement *
  17. Exponential Moving Average
  18. MACD
  19. Mass Index *
  20. Momentum
  21. Money Flow Index
  22. Negative Volume Index *
  23. On Balance Volume
  24. Pcnt Price Oscillator *
  25. Pcnt Volume Oscillator *
  26. Performance *
  27. Positive Volume Index *
  28. Price Envelope
  29. Price Volume Trend *
  30. Rate of Change
  31. Relative Strength Index
  32. Simple Moving Average
  33. Stochastic - Fast
  34. Stochastic - Slow
  35. Stochastic RSI *
  36. Standard Deviation *
  37. Triple Moving Average *
  38. TRIX *
  39. Ultimate Oscillator
  40. Volume
  41. Weighted Moving Average *
  42. Williams Percent R

Ease of Movement

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Ease of Movement was developed by Richard W Arms and performs a similar function to Equivolume charts. It highlights the relationship between volume and price changes and is particularly useful for assessing the strength of a trend.

The indicator shows:

  • high positive values when prices move upward on light volume;
  • high negative values when prices move down on light volume;
  • low values if price is not moving or if it takes heavy volume to move prices, signaling distribution or accumulation.

Calculation

The steps in calculating Ease of Movement are:

  1. Calculate the Mid-point for each day:                                     

                                        (High + Low) / 2

  2. Calculate the Mid-point Move for each day:                          

                                        Mid-point [today] - Mid-point [yesterday]

  3. The Box Ratio determines the ratio between height and width of the Equivolume box:                
                                        Volume [in millions] / (High - Low)

  4. Ease of Movement is then calculated as:                                                      

                                        Mid-point Move / Box Ratio
  5. Ease of Movement is normally smoothed with a 14 day exponential moving average.

Parameters

  • Period (20) - The number of smoothing days used in the EMA.

Trading Signals

Signals are normally taken from an exponential moving average plotted on the Ease of Movement indicator. They are more effective in a trending market.

  • Go long when Ease of Movement crosses to above zero (from below).
  • Go short when Ease of Movement crosses to below zero (from above).
  1. Go long [L]: Ease of Movement crosses to above zero.
  2. Go short [S]: Ease of Movement crosses to below zero.
  3. Go long [L]: Ease of Movement crosses to above zero.
  4. Go short [S]: Ease of Movement crosses to below zero.
  5. Go long [L]: Ease of Movement crosses to above zero.
  6. Go short [S]: Note that we are whipsawed more frequently in a ranging market.

 


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