The Intermediate-Term Breadth Momentum Oscillator (ITBM) was developed by Carl Swenlin to add a new perspective to the interpretation of the McClellan Oscillator. The Ratio-Adjusted version of the McClellan Oscillator is used for calculating this indicator.
To calculate the ITBM, add the daily McClellan Oscillator (Ratio-Adjusted) to the daily 10% exponential average (Ratio-Adjusted), then calculate a 20-day EMA of the result.
The ITBM is a barometer of breadth. The absolute value indicates how overbought/oversold the market is. Direction is most important because it indicates whether the market is getting stronger (rising) or weaker (falling). The best condition is for the ITBM to be rising above its 10-EMA, and the worst is falling below its 10-EMA. It is extremely negative if the ITBM tops below its 10-EMA and below the zero line.
The ITBM is a market indicator and therefore available on StockCharts.com as a collection of indexes - i.e., ticker symbols that start with an ”!” character. To see those indexes, you can search the “Symbol Catalog” for the phrase “ITBM” (or just click here).
The ITBM is also featured in the DecisionPoint Market Analysis Chart Gallery tool. Click here to see that tool.
The ITBM is an intermediate-term indicator that gives a different perspective of breadth than the shorter-term McClellan Oscillator. It can also be used to notify chartists whether negative McClellan Oscillator.