Force Index with Jurik Moving Average Smoothing

Summary

The document introduces the Force Index, an indicator attributed to Alexander Elder, and explains its basic calculation: the change in closing price multiplied by volume. It describes smoothing this one-period value to reveal directional pressure, noting that a shorter averaging period emphasizes near-term trends while a longer period is intended to show broader trends.

The featured version substitutes the Jurik Moving Average (JMA) for the usual exponential moving average when smoothing the Force Index. The document provides no formula for JMA, parameter settings, chart examples, performance evidence, or explicit trading rules. It therefore explains the indicator concept and the intended smoothing change, but does not establish that JMA improves signal quality. Traders would need to define how they interpret the smoothed readings and test them across instruments and time periods, while accounting for volume data quality and the limits of indicator-based signals.

Key ideas

• The Force Index multiplies the change in closing price by volume.
• Smoothing the one-period Force Index can help emphasize directional trends.
• Shorter averaging is described as more responsive to near-term trends than longer averaging.
• This version uses a Jurik Moving Average instead of an exponential moving average.
• The document provides no evidence that the JMA version improves trading results.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.