In today’s market, institutions dominate the marketplace.  They control billions of dollars and billions of shares of stock and it is estimated that over 80% of all transactions are institutional. Because of this dominance of the institutional trader, it is imperative that the retail trader be able to track institutional buying and selling patterns.  The only way to accurately determine if the large lot traders are buying or selling is to use the accumulation and distribution indicators. Balance of Power is probably the most popular of these indicators and is easy to use as it is a bar indicator with varying colors which makes for quick, reliable analysis.

All trading styles should use an accumulation and distribution indicator in indicator toolkits.  Accumulation and distribution indicators are leading indicators, which means they typically move in advance of price.