The TRIN, or Arms index, developed by Richard Arms in the 1970s, is a short-term
technical analysis stock market
A stock market, equity market, or share market is the aggregation of buyers and sellers of stocks (also called shares), which represent ownership claims on businesses; these may include ''securities'' listed on a public stock exchange, ...
trading indicator
In technical analysis in finance, a technical indicator is a mathematical calculation based on historic price, volume, or (in the case of futures contracts) open interest information that aims to forecast financial market direction. Technical indi ...
based on the
Advance-Decline Data The Advance-Decline data also known as AD data are calculated to show the number of advancing and declining stocks and traded volume associated with these stocks within a market index, stock market exchange or any basket of stocks with purpose of an ...
.
The name is short for TRading INdex. The index is calculated as follows:
:
A value below 1 usually indicates
bullish sentiment, and a value above 1 –
bearish. A reading reaching 1.5 is very bearish. The index was introduced by Richard Arms, and is continuously displayed during trading hours, among other indices, on the
New York Stock Exchange
The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its liste ...
's central wall display for the stocks traded on that exchange.
The denominator of the index is calculated based on number of shares traded, not their dollar value. Therefore, a highly traded stock with a low share price will affect the index more than the same dollar volume traded in a higher-priced stock.
References
External links
How to interpret the TRIN technical indicatorat OnlineTradingConcepts.com
Investopedia - Arms Index - TRIN
Market indicators
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