Advance-decline

A-D

In technical analysis, a line plotting the advance-decline index over a period of time. The advance-decline index takes the total of stock issues increasing on a trading day and subtracts the number of stock issues declining on the same day. Technical analysts use the index as an indicator of market movements, and use the advance-decline line to confirm a movement. If the line slopes upward over time, it indicates an upward trend, and, if it slopes downward, the opposite is true.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

Advance-decline (A-D) line.

The advance-decline line graphs the ratio of stocks that have risen in value -- the advancers -- to stocks that have fallen in value -- the decliners -- over a particular trading period.

The direction and steepness of the A-D line gives you a general idea of the direction of the market. For example, a noticeable upward trend, which is created when there are more advancers than decliners, indicates a growing market.

A downward slope indicates a market in retreat. At times, however, there may be no clear trend in either direction.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
References in periodicals archive ?
In fact, it especially is in sync with the advance-decline line, a measure of stock market breadth.
Market breadth with advance-decline ratio of 0.2:1 remained extremely weak.
''There's still a sense of overheating when we look at the advance-decline ratio, but the market is resilient.
According to analysts at the bank, the MSCI EMEA Index's 200-day moving average, the advance-decline ratio, risk appetite, cash levels, fund flows and seasonality of developing-economy stocks have turned negative.
The market breadth with advance-decline ratio of 2.7:1 remained favorable.
''There is still a sense of overheating when we look at the advance-decline ratio, but the market is resilient.
Market breadth with advance-decline ratio of 0.28:1 remained negative.
''With the advance-decline ratio remaining at a high level, we may see some corrective moves.
Market breadth with advance-decline ratio of 0.7:1 remained slightly negative.
''With the SQ over, and the advance-decline ratio at a high level, we saw some profit-taking.
The market breadth with advance-decline ratio of 0.56:1 remained unfavorable.
The advance-decline ratio stood at 163.47 percent on Thursday, sharply higher than 120 percent, a level that normally shows an overbought market, according to analysts.