The Demand Index is a combination of price and volume that appears to provide predictions of price changes. There are 6 rules when using the demand index:- weakness in price follows divergence between the demand index and price; after extreme peaks in the demand index, prices usually rally to new highs; tops are signalled by high prices and low demand index values; if the demand index goes below 0, a change in the trend has occurred; if it hovers near 0 for any time, price is weak; long term divergences indicate major tops or bottoms. To calculate this indicator is far too complex without special software, as 21 columns of data are required. As a lagging indicator, the demand index is of little use in day trading systems anyway, being more suited to longer term traders.
\nThe Demand Index combines price and volume in such a way that it is often a leading indicator of price change. The Demand Index was developed by James Sibbet.<\/p>\n
MetaStock Pro uses a slight variation on the Sibbet’s original Index so that the Index is displayed on a “normal” y-axis scale. The author’s Index is plotted on a scale labeled +0 at the top, 1 in the middle, and -0 at the bottom. MetaStock Pro uses a scale from +100 to -100. Other than the difference in y-axis labeling, the indicator is calculated exactly as designed by its author.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Demand Index is a combination of price and volume that appears to provide predictions of price changes. There are 6 rules when using the demand index:- weakness in price follows divergence between the demand index and price; after extreme peaks in the demand index, prices usually rally to new highs; tops are signalled by […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[1],"tags":[6003,6002,6004,2184,6005,918],"class_list":{"0":"post-2206","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-general","7":"tag-concept-of-demand-index","8":"tag-demand-index","9":"tag-demand-index-in-stock-market","10":"tag-forex-indicators","11":"tag-indicators-of-metastock","12":"tag-stock-market","13":"entry"},"_links":{"self":[{"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/posts\/2206","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/comments?post=2206"}],"version-history":[{"count":0,"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/posts\/2206\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/media?parent=2206"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/categories?post=2206"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.niftylivecharts.com\/blog\/wp-json\/wp\/v2\/tags?post=2206"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}