An oscillator that uses a similar calculation to the RSI’s using volume to weigh the average price values before summing.
Overview
The Money Flow Index (MFI) is similar to the Relative Strength Index (RSI) in calculation and interpretation except that volume is used to weigh the average price values before summing the positive and negative money flows.
The MFI is normalized and plotted on a 0-100 scale. Readings over 80 are considered overbought and readings under 20 are considered oversold.
The MFI on a daily chart of the USD/HKD 4/18/2011
Source: VT Trader
Implementation
The original Money Flow Index formula allows for a divide-by-zero error thus resulting in NULL values in the indicator plot. VT Trader has modified this formula to avoid such values.
