Negative Volume Index (NVI)
Negative Volume Index (NVI) attempts to identify bull markets by showing what the smart investors are doing. It is based on the assumption smart investors dominate trading on light volume days and uninformed investors dominates trading on active days. The NVI changes on days when the volume is down and stays flat on up volume days. Look for the NVI to rise above its one year moving average to signal a bull market.
Also see the Positive Volume Index.
The Negative and Positive Volume Index were developed by Norman Fosback and are described in his 1976 book, Stock Market Logic.
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