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10.13 Ease of Movement

The ease of movement indicator by Richard Arms shows a ratio of price movements over volume. Big moves on light volume mean easy movement through price levels, small moves and/or heavier volume means difficult movement.

       midpoint[today] - midpoint[yesterday]
Ease = -------------------------------------
                  box ratio

The midpoint is the middle of the day’s trading range, ie. (high+low)/2. The box ratio is volume over trading range, giving the amount of volume required to move by one price tick, on the day. Volume is taken in millions, to bring the scale up (with no effect on the shape).

box ratio = ------------------------
            high[today] - low[today]

Ease of movement is smoothed with an exponential moving average (see Exponential Moving Average), with default 14 periods. The raw daily values can be seen, if desired, by setting the average to 1 day.

Copyright 2002, 2003, 2004, 2005, 2006, 2007, 2008, 2009, 2010, 2011, 2012, 2014, 2015, 2016, 2017 Kevin Ryde

Chart is free software; you can redistribute it and/or modify it under the terms of the GNU General Public License as published by the Free Software Foundation; either version 3, or (at your option) any later version.