Ease of Movement
The EMV emphasizes days in which the stock is moving easily and minimizes the days in which the stock is finding it difficult to move. This indicator is used frequently with equivolume charts to identify market formations. A buy signal is generated when the EMV crosses above zero, a sell signal when it crosses below zero. When the EMV hovers around zero, then there are small price movements and/or high volume, which is to say, the price is not moving easily.
The volume is divided by a volume increment (typically 10,000) to make the resultant numbers larger and easier to work with. The EMV is usually smoothed with a moving average.
The Arms Ease of Movement indicator was developed by Richard W. Arms, Jr. See also Arms Index.
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