HomeTRIN (Arms Index) has been developed to detect overbought/oversold levels and could be considered as one of the most complex technical studies from the group of Breadth (advance/Decline) indicators in its interpretation.
The TRIN indicator is based on the advance decline issues and advance decline volume data. The same as with other Breadth indicators, TRIN could be applied to the basket of stocks (indexes, exchanges, etc) and cannot be applied to a single stock. It is calculated as a ratio between advance/decline issues ratio and advance/decline volume ratio:
TRIN = [Advance Decline Issues Ratio] / [Advance Decline Volume Ratio]
where
Advance Decline Issues Ratio = [Advanced Stocks] / [Declined Stocks]
and
Advance Decline Volume Ratio = [Advanced Volume] / [Declined Volume]
Furthermore TRIN formula could be expressed in the following format:
TRIN = ([Advanced Stocks] * [Declined Volume]) / ([Declined Stocks] * [Advance Volume])
The
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Specifics of Trin Analysis
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