Description

• Developed by Donald Dorsey for predicting price reversal, Mass index uses day range to know price direction
• High and low mass index value evolves based on price movement
• It is always a positive value

Interpretation

• If Mass index value is high, it indicates possible trend reversal
• If Mass index is low, it indicates stock is silent and may be non trending
• Mass index along with EMA on price can be used for divergence and strong signals

Default Parameters Used/Inputs

• High Line
• Low Line
• Bars

Returns/Output

Mass Index values of stock for the specified period

Formula

Mass Index = EMA ( High – Low ) / EMA (EMA ( High – Low ))