VMI combines price momentum (ROC) with volume strength (AVG Volume) to create a single indicator that shows how much power is behind price moves. Strong momentum + high volume = powerful move. Weak momentum + low volume = weak move.
Key Use: Identify powerful price moves backed by volume conviction.
VMI = ROC(Close, 14) × (Volume / SMA(Volume, 14))
Weight: Price momentum × Volume ratio
Move Strength Assessment
High VMI = strong conviction move; likely to continue.
False Move Detection
Price spike but low VMI = weak move likely to reverse.
Trend Strength Rating
Monitor VMI levels to gauge trend sustainability.
✓ Advantages
⚠ Limitations