Technical Indicators

Market Facilitation Index (BW MFI)

Purpose

The Market Facilitation Index is designed to indicate how much of a willingness to move the price is there in the market. The indicator's absolute values alone cannot provide any trading signals unlike it's dynamics in relation to the dynamics of the volume.


Usage

The absolute values of the index are represented by the histogram's bars while the comparison of the index and volume dynamics are given in colors which are vital in terms of reading the indicator signs.

  • Green bar - both MFI and volume are up. Increasing trading activity means market movement acceleration. We may join the trend.


  • Blue bar - MFI is up, volume is down. The movement is continuing although the volume has dropped. The trend will soon be reversing.


  • Pink bar - MFI is down, volume is up. The slowing down movement while volume is raising may indicate a possible break through, often a U-turn.


  • Brown bar - both MFI and volume are down. The market is no longer interested in the current direction and is looking for signs of a future development.



Calculation

BW MFI = (HIGH-LOW)/VOLUME


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