GlossaryIntermediate
Force Index
An indicator combining a price move's size, direction, and volume into a single value measuring the force behind it.
The Force Index, developed by Alexander Elder, combines a period's price change (both size and direction) with its trading volume into a single value, intended to measure the actual "force" behind a price move rather than its size alone.
A large price move on low volume produces a smaller Force Index reading than the same price move on high volume, directly reflecting the idea that a move is more significant when more trading activity backs it. See Kaavon's dedicated Force Index article for the full calculation.
Examples
- A large price move on unusually low volume produces a comparatively weak Force Index reading, flagging it as less significant than its size alone suggests.
- The Force Index is commonly smoothed with a short EMA to reduce noise before being used for signals.