26

VOLUME II: VOLUME INDICATORS

Questions

Subjects to Be Covered

Interpreting the rate of change of volume

The volume oscillator

The calculation and interpretation of the Demand Index

The assumptions underlying the calculation of the Chaikin Money Flow

Interpreting the Chaikin Money Flow

Construction and interpretation of the Arms Index

On Balance Volume

Upside/downside volume interpretation

1. A high reading in a volume ROC indicates:

A. A high level of volume

B. An overbought market

C. An oversold market

D. A and B

2. What is likely to happen when both trendlines in the following chart are violated? The series in the upper window is the price, and that in the lower one is a volume oscillator.

A. The price will rally.

B. The price will fall. ...

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