# Force Index A Volume & Order Flow concept (Cumulative flow lines) in the LuxAlgo Library, with 1 indicator implementation. ## What is the Force Index? The Force Index is Alexander Elder's volume-weighted momentum measure, introduced in his 1993 book Trading for a Living. Each bar's raw value is the change in close from the prior bar multiplied by volume, so one number captures direction, the size of the move, and the participation behind it. A strong advance on heavy volume prints a large positive value; a drift on thin volume barely registers. The raw series is too jagged to read, so Elder smoothed it with an [EMA](https://www.luxalgo.com/library/concept/ema/): a 2-period EMA for short-term entry timing and a 13-period EMA for tracking intermediate-term buying and selling pressure. Readings above zero say bulls dominated recent bars, readings below zero say bears did, and zero-line crosses and divergences against price are the standard signals. The design's insight is multiplicative: direction alone (the sign), distance alone (the change), and participation alone (the volume) each mislead in isolation, and multiplying them means a bar only prints force when all three agree it should. That is also the construction's known bias, since one news bar combining a large move with climactic volume can dominate weeks of the series, which the smoothing dampens but cannot erase. The two published lengths divide the labor deliberately: the 2-period EMA is a hair-trigger gauge of the last few bars' pressure, built to find pauses inside trends, while the 13-period line tracks the swing-scale balance of power. Within Elder's own framework the Force Index is a second-screen tool: the triple-screen method sets direction on a higher timeframe, then uses the short Force Index dipping against that direction as the entry timer, which is why the 2-period version's whipsaw is a feature in context and a menace standalone. The lineage continues in modern derivatives, directional-energy ratios and volume-accelerated momentum studies that refine the same price-change-times-volume core, and in hybrid uses where force readings color or filter other systems. The usual volume caveats apply wherever the volume leg is proxy or fragmented. ## How to identify Force Index readings One multiplication, two smoothings, and a division of labor between them. 1. Compute the raw value per bar: the close-to-close change multiplied by the bar's volume. 2. Smooth twice, separately: a 2-period EMA for the short-term pressure gauge, a 13-period EMA for the intermediate balance. 3. Read the zero line: above, bulls have supplied the recent force; below, bears; crosses mark the handoff. 4. Use each length for its job: the 2-period line finds pauses inside trends, the 13-period line tracks swing-scale pressure and prints the divergences worth acting on. 5. Weigh extremes against the series' own history: a multi-week record in force behind a move is conviction, while an unremarkable reading behind a breakout is the warning. ## How it's calculated An oscillator that measures the pressure behind each bar as the product of price change and volume. ``` FI1_t = (C_t - C_(t-1)) × V_t FI_t = EMA_n(FI1_t) C_t: close of the current bar C_(t-1): close of the prior bar V_t: volume of the current bar t: bar index FI1_t: raw 1 bar Force Index FI_t: smoothed Force Index plotted by the indicator EMA_n: exponential moving average with smoothing factor 2 / (n + 1) n: smoothing length (commonly 13; Elder also used 2) ``` Published by Alexander Elder in Trading for a Living (1993). Elder used the 2 period EMA for short term timing and the 13 period EMA for the intermediate trend; the raw 1 bar series is rarely plotted on its own. The oscillator is unbounded and scales with the instrument's volume, so absolute values are not comparable across markets. ## How traders use it - Pullback entries within a trend: Elder's classic tactic buys when the 2-period Force Index dips below zero in an uptrend (a brief pause in buying pressure) and shorts pops above zero in a downtrend, with a separate trend filter deciding direction. - Divergence: price printing a lower low while the 13-period Force Index makes a higher low signals fading selling force, a standard [bullish divergence](https://www.luxalgo.com/library/concept/regular-bullish-bearish-divergence/) read that Elder emphasized. - Breakout validation: a breakout accompanied by a multi-week extreme in the Force Index shows volume-backed conviction, while one on a modest reading earns more skepticism, the same question [volume at breakout](https://www.luxalgo.com/library/concept/volume-at-breakout/) asks directly. - Inside the triple-screen workflow: a higher-timeframe screen sets direction, and the short Force Index dipping against that direction supplies the entry timing, the role Elder designed the 2-period line to play. - As a component in modern derivatives: directional-energy and volume-accelerated momentum studies refine the same core product of price change and volume, and force readings serve as background coloring or filters on unrelated systems. ## Force Index vs related volume measures - **OBV** (https://www.luxalgo.com/library/concept/obv/): OBV accumulates whole-bar volume by close direction into a running balance, ignoring move size entirely. The Force Index is per-bar and magnitude-weighted, oscillating around zero. OBV asks who has been winning overall; the Force Index asks how hard the last few bars were pushed. - **Volume Delta** (https://www.luxalgo.com/library/concept/volume-delta/): Delta splits each bar's actual tape by aggressor side, a microstructure measurement; the Force Index approximates pressure from the close change and total volume, a chart-level proxy. Delta is finer and needs tick data; force is coarser and computes anywhere. - **Money Flow Index** (https://www.luxalgo.com/library/concept/money-flow-index/): MFI pushes volume-weighted typical price through RSI arithmetic into a bounded 0-100 oscillator with overbought and oversold conventions. The Force Index stays unbounded and centered on zero, trading level conventions for honest magnitude. Bounded rank versus raw push. ## FAQ ### What is the difference between the Force Index and OBV? [OBV](https://www.luxalgo.com/library/concept/obv/) is cumulative: it adds or subtracts each bar's whole volume based only on close direction and keeps a running total. The Force Index is per-bar: the close-to-close change multiplied by volume, then smoothed with an EMA, so the size of each move matters and the line oscillates around zero rather than tracking a running balance. ### Which Force Index settings did Elder recommend? Elder used a 2-period EMA of the raw series for short-term timing, spotting brief pauses in pressure inside an established trend, and a 13-period EMA for the intermediate balance between buyers and sellers. The raw one-bar series is rarely plotted on its own because it is too erratic to read comfortably. ### Why multiply by the close change instead of just its sign? Because magnitude is information. A one-tick up-close on heavy volume and a three-percent surge on the same volume are wholly different events, and sign-only accumulators like OBV score them identically. The multiplication makes the Force Index distinguish drift from thrust, at a known price: outsized bars dominate the series, so a single news event can own the line until the smoothing digests it. ### What does the zero line mean on the Force Index? Balance. The smoothed product of price change and volume nets recent buying force against selling force, so above zero the recent bars' pressure has favored bulls and below zero bears. Zero-line crosses on the 13-period line mark swing-scale handoffs of control; on the 2-period line they happen constantly by design, which is why that length is read as a pause-finder inside a trend rather than a direction signal. ### Isn't the 2-period Force Index just whipsaw? Standalone, yes, deliberately so. Elder built it as the timing screen inside a system where direction is already decided by a higher-timeframe trend filter: in an uptrend, its dips below zero mark the brief exhaustion of buying pressure that makes an entry, and its own flip back up is the trigger. Used without the trend screen it is noise with a formula, which is the fate of most timing tools separated from their frameworks. ### Does the Force Index work on forex and crypto? With the volume caveats those markets always impose. Spot forex substitutes tick counts for true volume, making the force leg a proxy of uncertain quality; crypto volume is real but venue-fragmented and occasionally synthetic. The construction still functions as a magnitude-weighted momentum gauge, and relative reads on one consistent feed retain meaning, but conviction conclusions deserve the discount that any volume-derived tool carries off the centrally reported markets. ## Implementations in the Library - Force Index (LuxAlgo, the standard build of the classic formula): https://www.luxalgo.com/library/indicator/force-index/ ## Related concepts - Money Flow Index: https://www.luxalgo.com/library/concept/money-flow-index/ - Weis Wave Volume: https://www.luxalgo.com/library/concept/weis-wave-volume/ - OBV: https://www.luxalgo.com/library/concept/obv/ - OBV Divergence: https://www.luxalgo.com/library/concept/obv-divergence/ - Accumulation/Distribution Line: https://www.luxalgo.com/library/concept/accumulation-distribution-line/ - Chaikin Oscillator: https://www.luxalgo.com/library/concept/chaikin-oscillator/ - Chaikin Money Flow: https://www.luxalgo.com/library/concept/chaikin-money-flow/ - Twiggs Money Flow: https://www.luxalgo.com/library/concept/twiggs-money-flow/ - Williams A/D: https://www.luxalgo.com/library/concept/williams-a-d/ - Price Volume Trend: https://www.luxalgo.com/library/concept/price-volume-trend/ --- Source: https://www.luxalgo.com/library/concept/force-index/ (LuxAlgo Library, the encyclopedia of trading & technical analysis). Free to use with attribution: https://www.luxalgo.com/library/license/