Accumulation Distribution (A/D) Oscillator

The A/D oscillator is a “normalized” oscillator. An A/D oscillator is divided by a number that is a multiple of a period’s range. Each period is treated independently. This “normalizes” the study and enables it to adapt to changing trading ranges.

Formula:

Where:

BP = buying power, or high-open

SP = selling power, or close-low

H = high

L = low

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see, Kaufman, P. J., The New Commodity Trading Systems and Methods, New York: John Wiley & Sons, 1987.