Absolute Breadth Index - ABI

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DEFINITION of 'Absolute Breadth Index - ABI'

A market indicator used to determine volatility levels in the market without factoring in price direction. It is calculated by taking the absolute value of the difference between the number of advancing issues and the number of declining issues. Typically, large numbers suggest volatility is increasing, which is likely to cause significant changes in stock prices in the coming weeks.

INVESTOPEDIA EXPLAINS 'Absolute Breadth Index - ABI'

This tool is classified as a breadth indicator because the advancing/declining values are the only values used to create it. This index can be calculated using any exchange or a subset of an exchange, but traditionally the New York Stock Exchange has been the accepted standard.

To learn more on how to use this indicator, check out "What are the best technical indicators to complement the Haurlan Index?"

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RELATED FAQS
  1. What are the best technical indicators to complement the Haurlan Index?

    The Haurlan index is a market breadth indicator used primarily to identify overbought and oversold conditions. Like most ... Read Full Answer >>
  2. What is the Haurlan Index formula and how is it calculated?

    The Haurlan Index is a market-wide breadth indicator developed by rocket scientist P.N. Haurlan. The index has three separate ... Read Full Answer >>
  3. What are the most important trading signals used with the Absolute Breadth Index ...

    The absolute breadth index (ABI) is one of the more common market volatility oscillators used by traders and technical analysts. ... Read Full Answer >>
  4. How does a swing trader use the stochastic oscillator?

    The stochastic oscillator is a momentum technical indicator used to indicate points of possible price reversals. Swing traders ... Read Full Answer >>
  5. How can I spot trading opportunities looking at year-to-date (YTD) performance?

    Trading opportunities on the long side can be spotted by looking at stocks with the worst year-to-date (YTD) performance, ... Read Full Answer >>
  6. How does Net Operating Profit After Tax give a clearer view of the operating efficiency ...

    Net operating profit after tax (NOPAT) gives a clearer view of the operating efficiency of a company. While NOPAT is a measure ... Read Full Answer >>
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