What does ABI mean in UNCLASSIFIED

The Absolute Breadth Index (ABI) is a technical indicator used in financial markets to measure the breadth of market participation. It measures the number of stocks participating in an upward move compared to those that are declining, providing insight into the overall strength of trends.

The ABI is calculated by subtracting the number of securities decreasing from the number increasing and then dividing this figure by their sum. This gives an indication of how broad market participation is on any given day, allowing investors to better evaluate current market conditions and make informed trading decisions.

The ABI can be used by traders and investors as a tool for identifying entry and exit points for entering or exiting positions in a particular security or sector. It can also be used as a proxy for sentiment, helping investors to determine whether there is increased buying or selling activity in a particular stock or market segment.

Interpretation of ABI readings depends on what time frame you're looking at; however, generally speaking, an ABI above +100 suggests strong positive momentum while an ABI below -100 suggests strong negative momentum. An index reading close to 0 means that there's neither buying nor selling pressure and could suggest range-bound trading activity.

Yes, one limitation when using the ABI is that because it only takes into account price action it does not take into account other factors such as volume which may also provide important clues about market direction.