Investors Versus Speculators Indicator from Tick Volume and Price Flow

Summary

The indicator estimates and compares cumulative activity attributed to investors and speculators using tick volume. It exposes a calculation period and a choice between two accumulation/distribution methods. In both methods, average volume is a simple moving average over the selected period. When current volume exceeds that average, the calculation assigns the accumulation/distribution value to investors; otherwise it assigns it to speculators. The displayed delta is the investor estimate minus the speculator estimate.

The classical method derives the accumulation/distribution value from the close's position within the high-low range and multiplies it by volume. The Trade Station variant instead uses the close-open change relative to that range. These formulas and branching rules explain the indicator's construction, but the document provides no evidence that its investor and speculator labels correspond to actual participant identities. Tick volume is the input, so the output should be read as a price-volume classification heuristic rather than direct measurement of market positioning. The source also does not specify behavior when the high and low are equal.

Key ideas

• The indicator separates cumulative activity into investor and speculator estimates according to volume versus its moving average.
• Its displayed delta is calculated as the investor estimate minus the speculator estimate.
• Two accumulation/distribution formulas are offered: one based on the close within the high-low range and one on the close-open change.
• The calculation uses tick volume, so its categories are inferred rather than observed trader identities.
• The document gives formulas but no validation evidence or handling for a zero high-low range.

Tags

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