Accumulative Swing Index

The Accumulative Swing Index (ASI) is a variation of Welles Wilder’s swing index. It plots a running total of the swing index value for each bar.

This indicator is credited for being able to show the longer term trend of a given security then the regular swing index.

Below is an example of how it looks on a chart.

It can be used to confirm breakouts of a given security. If this siganl breaks out to the upside at the same time the stock breaks out to the upside it is a buy signal. The opposite is true for new lows.

The calculation for the Accumulative Swing Index (ASI) looks like this

SI(i) = 50*(CLOSE(i-1) - CLOSE(i) + 0,5*(CLOSE(i-1) - OPEN(i-1)) + 0,25*(CLOSE(i) - OPEN(i)) / R)*(K / T) ASI(i) = SI(i-1) + SI(i)

Where

SI (i) — current value of Swing Index technical indicator;

SI (i - 1) — stands for the value of Swing Index on the previous bar;

CLOSE (i) — current close price;

CLOSE (i - 1) — previous close price;

OPEN (i) — current open price;

OPEN (i - 1) — previous open price;

R — the parameter we get from a complicated formula based on the ratio between current close price and previous maximum and minimum;

K — the greatest of two values: (HIGH (i - 1) - CLOSE (i)) and (LOW (i - 1) - CLOSE (i));

T — the maximum price changing during trade session;

ASI (i) — the current value of Accumulation Swing Index.