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Indicators  |  APR 2002

How Accurate Is The A/D Line? by Lawrence G. McMillan

How Accurate Is The A/D Line? by Lawrence G. McMillan Maybe not as accurate as you think. Here’s one way to get more realistic results. For much of 2001 — especially the first eight months of the year — market technicians were often quoted as saying that market breadth was strong and, by inference, that there was an underlying positive tone to the market. The indicator often used to demonstrate this was the advance-decline (A/D) line — the daily difference between advancing and declining New York Stock Exchange (NYSE) issues. There were more advances than declines for quite a few days in that time period, yet the market continued to struggle. So where was all this supposedly positive action?

by Lawrence G. McMillan

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