ARMS Index

The ARMS Index is considered by many technical analysts to be one of the most useful indicators for determining market breadth.  The ARMS Index uses stock exchange advancing/declining issues as well as advancing/declining volume.

ARMS Index

The ARMS Index is considered by many technical analysts to be one of the most useful indicators for determining market breadth.  The ARMS Index uses stock exchange advancing/declining issues as well as advancing/declining volume to produce an indicator that identifies short-term overbought and oversold market conditions.  The ARMs Index is typically used for trading the NYSE and Nasdaq but may be applied to any exchange.  It was invented by Richard Arms in 1967.  


ARMS Index Formula

The index is calculated by dividing the Advance/Decline Ratio by the Advance/Decline Volume Ratio as per the following formula:

Arms Index formula

ARMS Index Interpretation

The ARMS Index is also called the Short Term Trading Index (TRIN).  For more information on how to use the ARMs Index visit TRIN Indicator.

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