Market Thrust Indicator – This Powerful Trading Measurement Explained

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This technical analysis guide explains what the Market Thrust Indicator (MTI) is and how it can be read on a trading chart.

We cover the different components of the MTI, in depicting falls and rises in price, and we explain how the MTI can be used to spot divergences with example charts.

What Is The Market Thrust Indicator?

The Market Thrust indicator is a powerful measure of the stock market’s internal strength or weakness. There are four components to this indicator:

  1. Advancing Issues on the New York Stock Exchange (NYSE) – $ADV or $NYADV
  2. Advancing Volume on the NYSE – $UVOL or $NYUPV
  3. Declining Issues on the NYSE – $DECL or $NYDEC
  4. Declining Volume on the NYSE – $DVOL or $NYDNV

This is the formula for the Market Thrust indicator:

(Advancing Issues x Advancing Volume) – (Declining Issues x Declining Volume)

How To Read The Market Thrust Indicator

market thrust indicator confirming price movement
This is the chart for mini-Dow futures.

When used for day-trading, the trend of the Market Thrust indicator is what is most important.

  • Rising Market Thrust Indicator: Considered a bullish sign; can act as a confirmation signal when combined with a rising stock, index ETF, or stock index future’s price.
  • Falling Market Thrust Indicator:  Considered a bearish sign; can act as a confirmation signal of a decreasing market price.

Market Thrust Indicator For Divergences

The Market Thrust indicator could be used for detecting divergences in trends. Divergences occur when:

  • Price is trending higher, but the Market Thrust indicator is not moving higher or is even going down.
  • Price is trending lower, however, the Market Thrust technical analysis tool is not trending lower, it is either not trending or is trending higher.

The following illustration shows the Market Thrust indicator uncovering divergences in price trend. This is the 5-minute chart of the mini-Dow Jones Industrial Average futures contract:

market thrust diverging from price

The first third of the day, the Dow futures contract increased quite impressively.

However, the Market Thrust indicator was falling – an equally impressive bearish divergence.

In fact, the Market Thrust line was lower when the Dow future made its high for the day than the level of the technical indicator was when it first opened the day.

A similar technical indicator is the Arms Index TRIN.

Where Can I Trade Using The MTI?

If you are interested in trading stocks, or other commodity assets using technical analysis, have a look at our reviews of these regulated brokers available in to learn which charting & analysis tools they offer:

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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 71.00%-89.00% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Further Reading

Learn more about technical analysis indicators, concepts, and strategies including Doji Patterns, Stochastics, Moving Averages, Candlestick basics, Fibonacci tools, and many others.

Also see our guides on Forex, BitcoinStocks, Cryptocurrency, and Options brokers to find out which technical charting tools online brokerages offer their clients.

FAQs

What does the Breadth Thrust Indicator measure?

The breadth thrust indicator, also known as the market thrust indicator, measures the overall momentum of the market. The four measured components of advancing issues, advancing volumes, declining issues, and declining volumes give an overview of the market’s potency. See our detailed explanation here.

Who developed the Breadth Thrust Indicator?

The thrust indicator was developed as a technical analysis tool by an American investor and financial analyst named Martin Zweig. According to Zweig, the entire purpose of the indicator is to measure extreme changes in the market within a short, compressed time frame. It is also known ans the Zweig Indicator.

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