Force Index - traditional general approach

Force Index indicator was developed by Alexander Elder. It is a volume and momentum oscillator designed to measure the strength of buyers (bulls) during rallies and sellers (bears) during market declines.

• Force Index value above zero indicates dominant buying pressure.
• Negative value of Force Index (below zero) suggests strong selling pressure.
• Alternatively, if the price is on low volume so it is indicating the flat or the ranging market condition for the price to be moved within narrow support/resistance channel for example.

The traders are traditionally using this indicator with two parameters:

• short-term approach (2 periods) - it is used to identify entry points during pullbacks;
• medium-term approach (13 periods) as a trend-following tool to indentify the primary trend as the bearish or bullish condition;
• long-term approach (100 periods) is used for possible long-term forecasting together with the other indicators for example.

Force Index indicator is usually used tgether with the other indicators such as EMA/SMA, Ichimoku and others (depends on the strategy, pair/symbol and timeframe for medium or long term analysis for example).