Pages

Sunday, December 2, 2007

Money Flow Index

Money Flow Index or Smart Money Flow Index
The purpose of using MFI is to detect accumulation and distribution.

MFI is a more rigid indicator because it is volume-weighted, and is therefore a good measure of the strength of money flowing in and out of a security.

It compares "positive money flow" to "negative money flow" to create an indicator that can be compared to price in order to identify the strength or weakness of a trend. Like the RSI, the MFI is measured on a 0 - 100 scale and is often calculated using a 14 day period.

The extreme readings do not always result in major tops and bottoms.

Formula
Typical Price = ( (Day High + Day Low + Day Close) / 3)
Money Flow = (Typical Price) x (Volume)

The MFI compares the ratio of "positive" money flow and "negative" money flow. If typical price today is greater than yesterday, it is considered positive money. For a 14-day average, the sum of all positive money for those 14 days is the positive money flow. The MFI is based on the ratio of positive/negative money flow (Money Ratio).

Money Ratio = (Positive Money Flow / Negative Money Flow)
Money Flow Index = 100 - (100 / (1 + Money Ratio))

To Calculate Money Flow Index in MS Excel:.

Column values to enter formulas U have to enter

A = Company Name/date
B = Open
C = High
D = Low
E = LTP/close
F = Volumes

G = Typical Price = (Day High + Day Low + Day Close)/3 So formula =(C2+D2+E2)/3
H = Money Flow = (Typical Price) x (Volume) So formula =G2*F2
I = Positive Money Flow,So formula =IF(G2 greater than G1,H2,0)
J = Negative money flow,So formula =IF(G2 less than G1,H2,0)
K = Average Positive Money Flow(14days) So formula =SUM(I2:I15)
L = Average Negative Money Flow(14days) So formula =SUM(J2:J15)
M = Money Ratio = (Po.Money Flow/Neg.Money Flow) So formula =K15/L15
N = Money Flow Index = 100 - (100 / (1 + Money Ratio)) So formula =100-(100/(1+M15))

Pls note: replace "greater than" with symbol ">" and"less than" with symbol "<".if used any where.

14 comments:

www.ShareTipsInfo.com Team said...
This comment has been removed by a blog administrator.
Slogan of Life said...

Car Insurance

Let Hunt4me take the stress out of searching for your car insurance and save you money. Compare quotations from major UK car insurance providers.

Slogan of Life said...

Car Insurance

Let Hunt4me take the stress out of searching for your car insurance and save you money. Compare quotations from major UK car insurance providers.

KnowYourProfit said...
This comment has been removed by a blog administrator.
Insightt said...
This comment has been removed by a blog administrator.
stockproindia said...
This comment has been removed by a blog administrator.
Stock market trading said...

Sharemarketzone is a network of various top stock market analyst who are posting their research at one place for the various stock market traders and investors for free

stock tips said...

MFI may help me & seems economically beneficial also...Thanks a lot for excellent post here.

Commodity Tips

anne tigerstocks said...

nice info!! thanks for sharing Best Stock Market Tips

Mohammed Shakir said...

What is G1, How it is calculated?

marketgyan seo said...
This comment has been removed by a blog administrator.
Free Stock market tips | Free share market tips said...
This comment has been removed by a blog administrator.
Share tips said...

Its very nice to read information given here. http://www.intradaytips.com

md razu Ahmed said...




What you get from RSC Bux - Main Benefits :

Earn from home
Garneted ads daily
Detailed statistics
forum permissions
Upgrade plans
Instant Payment
Reach millions of clients
Easy management
Demographic filter
Affordable rates
Anti-cheat protection




bux
the rsc bux
advertising
perfect money
get Free Money Online