Money Flow Index

The Money Flow Index (MFI) is an index dedicated to the measure of the flow of total money volumes on an asset, so it is an indicator of momentum.
The Money Flow Index (MFI) can be defined as a composition between Relative Strength Index and On Balance Volume since the Money Flow Index is calculated on the basis of prices and session volumes, with the aim of measuring the strength of a movement as a resultant force of volumes and price movement. It can therefore be used as an overbought signal (values over 80), or oversold (values below 20), but also as an indicator of divergence, in practice for a growing MFI and stable prices or even a slight drop it is shaping a trend change therefore a sign of a positive trend. In the opposite case, ie for descending MFIs and rising prices, a negative trend change is predicted. Even in this case it is rare to find oneself in these circumstances but the signal is reliable.