Cumulative Volume Index - CVI

DEFINITION of 'Cumulative Volume Index - CVI'

A momentum indicator that gauges the movement of funds into and out of the entire stock market by adding the difference between advancing and declining stocks to a running total.

BREAKING DOWN 'Cumulative Volume Index - CVI'

By showing the direction of volume flow, the CVI is very similar to OBV. The difference between the two indicators is in the actual methods of calculation. CVI uses actual up and down volume statistics while OBV generalizes the closing prices of a particular security.

CVI can be useful in determining the overall trend and its starting point. Any divergences between the CVI and the market index are indicators of a future correction.

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RELATED FAQS
  1. What is the On-Balance Volume (OBV) formula and how is it calculated?

    Read about the formula and calculation for On Balance Volume, or OBV, which is a technical indicator that shows movements ... Read Answer >>
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    Discover reasons why the on-balance volume momentum indicator has become one of the most widely used and trusted tools of ... Read Answer >>
  3. How do I use On-Balance Volume (OBV) to create a forex trading strategy?

    Read about some of the basic ways On-Balance Volume indicators can be used by forex traders to measure volume trends and ... Read Answer >>
  4. What is a common strategy traders implement when using On-Balance Volume (OBV)?

    Read about common trading strategies that are implemented based off of signals generated from the On-Balance Volume momentum ... Read Answer >>
  5. What is the Cumulative Volume Index (CVI) formula and how is it calculated?

    Discover how to calculate the cumulative volume index, a technical momentum indicator used by traders and analysts to gauge ... Read Answer >>
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    Understand the basics of On Balance Volume and the Money Flow Index, including their similarities and differences in terms ... Read Answer >>
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