Absolute Breadth Index - ABI

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.

Notes:

This tool is classified as a breadth indicator because the number of 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 NYSE has been the accepted standard.

See also: Advance/Decline Line - A/D, Breadth Indicator, Breadth of Market Theory, Volatility