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.

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RELATED FAQS
  1. 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 >>
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