How is the Force Index calculated?

The Force Index is a powerful indicator used in technical analysis that measures the strength behind a price movement by incorporating both price changes and trading volume. The calculation of the Force Index involves taking the difference between the current day's closing price and the previous day's closing price, which indicates the price movement. This difference is then multiplied by the current day's volume, which reflects the intensity or strength of that price movement.

This method effectively shows how strong a price movement is relative to the volume of trades, providing insights into the bullish or bearish momentum behind the price action. A strong positive Force Index indicates a strong bullish sentiment, whereas a strong negative value indicates bearish sentiment. Hence, the correct calculation aligns with how the Force Index effectively operationalizes the relationship between price changes and volume to assess market dynamics.