Building on the Accumulation/Distribution Line that was discussed in a separate learning center post, the formula for the ChaikinMoneyFlow (CMF) is the cumulative total of the Accumulation/Distribution values for 21 periods, divided by the cumulative total of volume for 21 periods. Below is an example, courtesy of stockcharts.com showing what the CMF looks like. The purple box encloses 21 days of Accumulation/Distribution (A/D) Values. The total A/D values over 21 days divided by the total volume over 21 days forms the value of CMF at the end of that 21 day series, denoted by the purple arrow. To calculate the next day, the A/D value from the first day is removed and the value for the next day is entered into the equation. Generally speaking, CMF is bullish when it is positive indicating that the security is under accumulation. CMF is bearish when it is negative, indicating the security is under distribution.
Chaikin Money Flow
Building on the Accumulation/Distribution Line that was discussed in a separate learning center post, the formula for the Chaikin Money Flow (CMF) is the cumulative total of the Accumulation/Distribution values for 21 periods, divided by the cumulative total of volume for 21 periods. Below is an example, courtesy of stockcharts.com showing what the CMF looks like. The purple box encloses 21 days of Accumulation/Distribution (A/D) Values. The total A/D values over 21 days divided by the total volume over 21 days forms the value of CMF at the end of that 21 day series, denoted by the purple arrow. To calculate the next day, the A/D value from the first day is removed and the value for the next day is entered into the equation. Generally speaking, CMF is bullish when it is positive indicating that the security is under accumulation. CMF is bearish when it is negative, indicating the security is under distribution.