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Indicator Guide > Money Flow > Williams Accumulation Distribution
Indicators A ~ Z > V ~ Z > Williams Accumulation Distribution
Education > Money Flow > Williams Accumulation Distribution

Williams Accumulation Distribution

Williams Accumulation Distribution is traded on divergences. When price makes a new high and the indicator fails to exceed its previous high, distribution is taking place. When price makes a new low and the WAD fails to make a new low, accumulation is occurring.

Williams Accumulation Distribution was created by Larry Williams.

Trading Signals

  • Go long when there is a bullish divergence between Williams Accumulation Distribution and price.

  • Go short on a bearish divergence.

Example

Commonwealth Bank of Australia (CBA) is plotted with  Williams Accumulation Distribution Williams Accumulation Distribution.

CBA bullish divergence between WAD and price. Go long.

Mouse over chart captions to display trading signals.

  1. Go long [L] on a bullish divergence.

Setup

See Indicator Panel for directions on how to set up an indicator. Edit Indicator Settings to alter the default settings.

Formula

To calculate Williams Accumulation Distribution:

1. Calculate the True Range High and True Range Low:

    True Range High is the greater of:

  • High [today], and
  • Closing price [yesterday]

    True Range Low is the lesser of:

  • Low [today]
  • Closing price [yesterday]

2. Compare Closing price to yesterday's Closing price:

  • If Close [today] is greater than Close [yesterday]
               Price Move [today] = Close [today] - True Range Low
  • If Close [today] is less than Close [yesterday]
               Price Move [today] = Close [today] - True Range High
  • If Close [today] equals Close [yesterday]
               Price Move [today] = zero

3. Multiply the price move by volume:
                      AD [today] = Price Move [today] * Volume [today]

4. Calculate the cumulative total:
                      Williams AD = AD [today] + Williams AD [yesterday]

AUTHOR'S NOTE:

Steven Achelis omits step 3. above in his book Technical Analysis A-Z and several other websites/software programs appear to follow this approach. For the benefit of investors accustomed to Achelis' approach, we have provided both versions. Achelis' version is described as Williams Accumulate Distribute.



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