Absolute Breadth Index - ABI


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.

BREAKING DOWN '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?"

  1. Advances And Declines

    The number of stocks that closed at a higher price than the previous ...
  2. Market Indicators

    A series of technical indicators used by traders to predict the ...
  3. Volatility

    1. A statistical measure of the dispersion of returns for a given ...
  4. Breadth of Market Theory

    A technical analysis theory that predicts the strength of the ...
  5. Breadth Indicator

    A mathematical formula that uses advancing and declining issues ...
  6. Advance/Decline Line - A/D

    A technical indicator that plots changes in the value of the ...
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  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. What are some of the most common technical indicators that back up Doji patterns?

    The doji candlestick is important enough that Steve Nison devotes an entire chapter to it in his definitive work on candlestick ... Read Full Answer >>
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    The exhausted selling model is a pricing strategy used to identify and trade based off of the price floor of a security. ... Read Full Answer >>
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