Chaikin money flow
Averages the Accumulation/Distribution concept over a set period into a single oscillator, showing sustained buying or selling pressure rather than one day's reading.
What the numbers mean
The lookback is how many bars of accumulation/distribution volume get summed and divided by total volume over the same window, producing a reading between −1 and +1. Twenty-one approximates a trading month.
- 20 or 21 — the lookback, about one trading month
- +0.25 / −0.25 — commonly treated as strong buying or selling pressure
- 0 — the dividing line between net accumulation and distribution
- Range runs from −1 to +1, though readings beyond ±0.5 are rare
How it is used
Sustained readings above zero indicate buying pressure over the window and below zero selling pressure; crossings of the zero line and divergence against price are the usual signals.
- Sustained readings above zero → buying pressure over the window
- Crossing zero → pressure changing sides
- Divergence against price → the usual warning
How it relates to everything else
CMF is the A/D line compressed into an oscillator, which makes it directly comparable to RSI and MFI on the lower panel. With only 20 bars in the window, one enormous volume day can dominate the reading for a month — worth checking before treating a high reading as steady accumulation.
- A/D averaged over a fixed window
- Compare with MFI: both weight volume, but MFI uses RSI's structure
- One outlier session can hold the reading up for the length of the window
What to watch for
It inherits A/D's indifference to gaps, and with only 20 bars in the window one enormous volume day can dominate the reading for a month.