What is A/D?
Accumulation/Distribution adds up volume bar by bar, but only part of each bar's volume counts, and with a sign. A bar that closed at its high adds its full volume, a bar that closed at its low subtracts it, and a bar that closed in the middle adds nothing. The result is a line in its own pane that rises while buyers keep closing bars near the top of the range and falls while sellers keep closing them near the bottom.
A/D measures where bars closed, weighted by volume. It does not look at the change from one close to the next, so a bar that gapped down and closed at its high still counts as buying. It does not predict price, and its absolute level has no meaning on its own.
How to use A/D
- Direction of the line. A rising line means volume has mostly come on bars that closed in the upper half of their range. A falling line means the opposite.
- Agreement with price. When price and A/D rise together, the move has volume closing strong behind it. When price makes a new high and A/D does not, fewer buyers are finishing the bars at the top.
- Divergence as a question, not an answer. A divergence between price and A/D can last a long time before anything happens, and often nothing does. Treat it as a prompt to look more closely.
- Slope, not level. The value depends on where the loaded history begins, so compare the line with itself over a recent stretch rather than reading the number.
These are ways to read the line, not entry signals on their own.
Settings
Accumulation/Distribution has no inputs. It always uses each bar's high, low, close and volume.
Calculation
Each bar gets a close location value between -1 and +1, which is multiplied by that bar's volume and added to a running total:
multiplier = ((close - low) - (high - close)) / (high - low)
= (2 * close - low - high) / (high - low)
flow = multiplier * volume
A/D = previous A/D + flowA close at the high gives a multiplier of +1, a close at the low gives -1, and a close exactly halfway gives 0. A bar with no range at all, where high equals low, would divide by zero, so it contributes nothing instead.
The running total starts at the first bar loaded on the chart and is plotted from that bar. If the data feed provides no volume for the market at all, the total stays at zero and the indicator shows the error "No volume is provided by the data vendor." instead of a flat line that could be mistaken for a reading.
Limitations
- It ignores gaps between bars. Only the position of the close inside the current bar matters. A market that gaps down and recovers slightly within the bar is counted as accumulation.
- The level is arbitrary. Because the total starts at the first loaded bar, the same market can show very different values depending on how much history is loaded.
- Volume quality varies. Crypto volume differs between exchanges and can include wash trading. A/D on one exchange only reflects that exchange's volume.
- Divergences are not timing signals. A/D can disagree with price for a long stretch while price keeps going.
- The live candle moves. The current bar's close, range and volume change until it closes, so its contribution changes too.
Frequently asked questions
Accumulation/Distribution is a running total of volume in which each bar's volume is scaled by where the bar closed inside its high-low range. Closes near the high add volume, closes near the low subtract it, so the line shows whether volume has been arriving on bars that finished strong or weak.
Read its direction and compare it with price. A line rising alongside price suggests buyers are finishing bars near their highs. Price making new highs while A/D flattens or falls is a divergence worth noting, but it is not a signal by itself and can persist for a long time. Ignore the absolute number, which depends on where the loaded history starts.
No. The built-in Accumulation/Distribution has no inputs. It always uses each bar's high, low, close and volume. You can change the line's colour and style in the indicator's style settings.
[On Balance Volume](/library/indicator/obv) adds or subtracts a bar's whole volume depending on whether the close was higher or lower than the previous close. A/D scales the volume by where the close sits inside the bar's own range and never looks at the previous close. The two can disagree, especially around gaps.
Values on closed bars are not revised. The current candle's contribution moves while that candle is live and settles when it closes. Because the line is a running total from the first loaded bar, loading more history shifts the whole line up or down, but the shape of the line on bars already shown does not change.
Use the Add to chart button at the top of this page. It opens BTC/USDT on Binance in the Altrady Charts terminal with the built-in Accumulation/Distribution already applied. On any other market, open the indicator picker on the chart and choose Accumulation/Distribution from the Volume group.