Twiggs Money Flow

What is Twiggs Money Flow?

Twiggs Money Flow (TMF) is Colin Twiggs' refinement of Chaikin Money Flow, which itself builds on the close-location logic of the Accumulation/Distribution Line. Each bar's volume is signed by where the close sits inside the true range (true high is the greater of the bar's high and the prior close; true low is the lesser of the bar's low and the prior close): a close at the true high counts the full volume as buying pressure, at the true low as selling pressure, and at the midpoint as zero net flow.

TMF is that signed volume, exponentially smoothed, divided by smoothed total volume, commonly over 21 periods, so it oscillates around zero and is bounded between -1 and +1. Sustained positive readings indicate accumulation, sustained negative readings distribution, and the zero line is the practical bull/bear divide. Using true range makes it gap-aware: a gap down that closes weak registers almost entirely as selling pressure instead of slipping through the formula, one of the two weaknesses (with lumpy rolling sums) the design set out to fix.

How traders use it

• As a trend-quality filter: holding longs only while TMF stays above zero (or a small positive threshold) keeps exposure aligned with net accumulation; the crossing itself is slow by design and will lag sharp turns.
• As divergence context: price printing new highs while TMF fades toward zero suggests the advance is being sold into, the same read applied to OBV and other flow lines, and just as fallible.
• As an independent cross-check: because TMF weights volume by close location within true range, it can disagree with a bounded oscillator like the Money Flow Index; agreement between the two is a stronger accumulation or distribution claim than either alone.