Charts

Money Flow Index (MFI)

Description

The Money Flow Index (MFI), developed by Gene Quong and Avrum Soudack, uses both price and volume to measure buying and selling pressure.

Formula

\[Pivot = \frac{(High + Low + Close)}{3}\]

\[MF = Money\;Flow = \begin{pmatrix} if\;Pivot_{t} > Pivot_{t-1}, & Pivot \times Volume \\ if\;Pivot_{t} < Pivot_{t-1}, & -Pivot \times Volume & \end{pmatrix} \]

\[MR = Money\;Ratio = \frac{\sum_{1}^{n} Positive\;MF}{\sum_{1}^{n} Negative\;MF}\]

over a user defined n-periods

\[MFI = 100 - \frac{100}{1+ MR_{n-periods}} \]