Master the "Institutional Flow" indicator. Learn how to track where the big money is moving by analyzing the relationship between price and volume.
The Accumulation/Distribution (A/D) line is a cumulative indicator that uses volume and price to assess whether a stock is being accumulated (bought by institutions) or distributed (sold by institutions). Unlike OBV, which just uses closing prices, the A/D line factors in the range of the price for the period, making it a more detailed assessment of supply and demand.
OBV is simpler; it only cares where the price closed. A/D is more nuanced, as it looks at where the price finished within its daily range, providing a better look at the intraday pressure between buyers and sellers.
No indicator can. A/D is best used to determine the *quality* of a trend. A trend backed by rising A/D is healthy; a trend with falling A/D is fragile and likely to fail.