Ease Of Movement

DEFINITION of 'Ease Of Movement'

A technical momentum indicator that is used to illustrate the relationship between the rate of an asset's price change and its volume. This indicator attempts to identify the amount of volume required to move prices. Generally a value greater than zero is an indication that the stock is being accumulated (bought) and negative values are used to signal increased selling pressure.
A high positive value appears when prices move upward on low volume. Strong negative numbers indicate that price is moving downward on low volume.

 

Ease Of Movement

BREAKING DOWN 'Ease Of Movement'

A moving average of the indicator can be added to act as a trigger line, which is similar to other indicators like the MACD. Transaction signals can be generated when the indicator crosses over a 9-day moving average, but are generally made when the indicator crosses over the zero line. Traders use the smoothed version of this indicator in an attempt to eliminate false signals.

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. Why is the Ease Of Movement Indicator important for traders and analysts?

    Read more about the ease of movement indicator, a technical momentum oscillator created by Richard Arms to track price changes ... Read Answer >>
  2. What is a common strategy traders implement when using the Ease Of Movement Indicator?

    Read about some common strategies that traders can implement to make the most of out the ease of movement indicator developed ... Read Answer >>
  3. How do I start using technical analysis?

    Technical analysis is a method of analyzing securities by evaluating current and historical price and/or volume activity. ... Read Answer >>
  4. What technical indicators can I use to find undervalued stock?

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  5. What are the best technical indicators to complement the Volatility Ratio?

    Learn why using the volume indicator with the volatility indicator helps investors identify breakouts from established trading ... Read Answer >>
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    Discover how forex traders can apply the ease of movement indicator with currency pairs to and highlight how sensitive price ... Read Answer >>
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