Swing
Index
This
momentum indicator is used
primarily as a component of
the Accumulative Swing Index.
Overview
Welles
Wilder developed the Swing
Index to provide a line "which
cuts through the maze of high,
low and close prices and indicates
the real strength and direction
of the market." (For a detailed
description refer to Wilder's
book New Concepts in Technical
Trading Systems.)
The
Swing Index is used primarily
as a basis for Wilder's Accumulative
Swing Index (ASI) indicator.
Mr.
Wilder summarizes the significance
of the Swing Index as follows:
- Swing
Index gives one numerical
value that always falls
between +100 and -100,
while incorporating current
and previous opening and
closing prices and true
range in its complex calculation.
- Swing
Index provides a line
which gives definitive
short-term swing points.
Interpretation
The
Swing Index alone doesn't
provide much in the way of
signals. It should be used
in conjunction with the Accumulative
Swing Index.
See
the Accumulative Swing Index.
