Extra indicators
EOM: Ease of Movement
How easily the price moves: big moves on little volume score high, small moves on heavy volume low.
The idea in plain words
If the price rises a lot without much trading, the way up is "easy". EOM relates the move of the candle's midpoint to its volume and range.
How it is calculated
Distance moved = midpoint − previous midpoint; box ratio = (volume ÷ 10,000) ÷ (high − low); EOM = distance ÷ box ratio, smoothed with an SMA(N).
EOM = SMA( ((H+L)/2 − (H₋₁+L₋₁)/2) ÷ ((V/10,000) ÷ (H − L)), N )How to use it
- Above zero: prices rise with ease; below zero: they fall with ease.
- Confirming breakouts.
Drawing conclusions
- The scale depends on the ticker's volume; compare it with its own past readings.
Example
NVDA daily: EOM jumps well above zero on a breakout day with average volume: the move met little resistance.
Prices in examples are illustrative.
Watch out for
- Uses tick volume on CFDs: good for direction, less for absolute levels.
A little history
Developed by Richard Arms in the 1970s.
Educational content only. No indicator or pattern predicts the future, and nothing here is investment advice.