What is Price Rate of Change and Advance-Decline Ratio ?

Answer 6A(iii) Price Rate of Change (ROC) The Price Rate of Change (ROC) is a momentum-based technical indicator that measures the percentage change in price between the current price and the price a certain number of periods ago. The ROC indicator is plotted against zero, with the indicator moving upwards into positive territory if price changes are to the upside, and moving into negative territory if price changes are to the downside. A rising ROC above zero indicates an uptrend in security prices whereas a falling ROC below zero indicates a downtrend in security prices. The ROC will hover near zero indicating a consolidation is security price. Formula: ROC = [(Closing Price (p) - Closing Price (p-n)) / Closing Price (p-n)] x 100 Where: Closing Price (p) = Closing price of the most recent period Closing Price (p-n) = Closing price n periods before most recent period Advance-Decline Ratio The Ratio of number of stocks that increase to the number of stocks that have declined. If the ratio is more than one, trend is assumed to be bullish. If the ratio starts declining a change in trend is signaled.