📊 TECHNICAL
Ease of Movement (EOM)
Measures how easily price moves per unit of volume, comparing the size of a price swing to the volume needed to produce it.
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Live Demo — Ease of Movement (EOM) applied to NIFTY 50 (illustrative)
PriceEMA(9)EMA(21)SMA(20)
What is Ease of Movement?
Created by Richard W. Arms Jr. (also known for the Arms Index), it relates the distance price travels to the volume required to move it. A large move on light volume produces a high reading — price is moving easily.
Formula
Distance = ((High(t)+Low(t))/2) - ((High(t-1)+Low(t-1))/2)
Box Ratio = (Volume/ScaleConstant) / (High(t)-Low(t))
EOM(raw) = Distance / Box Ratio
EOM = SMA(n, EOM(raw))Parameters
| Parameter | Default | Description |
|---|---|---|
| Smoothing period | 14 | SMA length applied to the raw EOM value |
| Scale constant | 100,000,000 | Divisor keeping volume comparable to price distance |
Signal Interpretation
- High positive EOM means price advanced on relatively low volume — an easy up-move.
- Deeply negative EOM means price fell on relatively low volume — an easy down-move.
- EOM near zero with high volume signals price meeting resistance/support despite participation.
- A zero-line crossing can mark a shift between easy upward and downward movement.
- Divergence between EOM and price can flag a move losing underlying support.
Tips & Best Practices
- Compare EOM values across the same instrument/timeframe rather than across different markets.
- Use the smoothed version for cleaner signals; raw EOM is noisy bar-to-bar.
- Works best combined with a trend filter.