How to use the Advance Decline Line

K

KiasuTrader

Hi I am trading the S&P e-mini and am just wondering how some traders use the NYSE A/D in their trading

I noticed that today was almost 3 to 1 on the advancing side and the market was unstoppable on the upside.

Was just wondering if some people have a formula like if more than 2 advancers to decliners then stay on the long side.

Also what is the normal range of A/D, when it isn't really telling you anything?

Thanks in Advance

Kiasu Trader
 
Some use a smoothed average of the Advance/Decline. Some also look at the A/D volume for more of a story. Some compare the A/D action to an index, such as the DOW, and look for divergences.
 
http://econwave.eventsherpa.com/homepage.php

Quote from KiasuTrader:

Hi I am trading the S&P e-mini and am just wondering how some traders use the NYSE A/D in their trading

I noticed that today was almost 3 to 1 on the advancing side and the market was unstoppable on the upside.

Was just wondering if some people have a formula like if more than 2 advancers to decliners then stay on the long side.

Also what is the normal range of A/D, when it isn't really telling you anything?

Thanks in Advance

Kiasu Trader
More...
 
Is that eventsherpa.com calendar in response to the part of KiasuTrader's question that states, "when it isn't really telling you anything"?.
 
Consider using the nyse trin ($TRIN) and nasdaq trin ($TRINQ) instead. It incorporates advancing and declining volume as well as advancing and declining issues. If you chart the trin you may see nice chart patterns at times. Most of the time it's not that helpful, but I still have it on my screen.
 
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