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many technical indicators are used by traders. Here we discuss Demand Index

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Demand Index

Developed by James Sibbet, the Demand Index is a combination of price and volume that appears to provide predictions of price changes. There are 6 rules when using the demand index:- weakness in price follows divergence between the demand index and price; after extreme peaks in the demand index, prices usually rally to new highs; tops are signalled by high prices and low demand index values; if the demand index goes below 0, a change in th etrend has occurred; if it hovers near 0 for any time, price is weak; long term divergences indicate major tops or bottoms. To calculate this indicator is far too complex without special software, as 21 columns of data are required.

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Using Demand Index when day trading, plus swing trading strategies using Demand Index and investing based on the Demand Index indicator