> For the complete documentation index, see [llms.txt](https://help.quantower.com/quantower/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://help.quantower.com/quantower/analytics-panels/chart/technical-indicators/moving-averages/demand-index.md).

# Demand Index

The Demand Index is a technical indicator that uses both price and volume to measure buying and selling pressure in the market.

Developed by James Sibbet, this indicator is often seen as a leading signal of future price changes. Sibbet outlined six key rules for interpreting the Demand Index, which are useful for traders looking to apply it effectively:

1. A divergence between the Demand Index and prices suggests a potential price reversal.
2. A high peak in the Demand Index often comes before new price highs.
3. When prices rise but the Demand Index falls, it usually indicates a market top.
4. The Demand Index crossing the zero line signals a change in trend.
5. If the Demand Index stays around zero, it shows weak price movement that likely won’t last.
6. A long-term divergence between the Demand Index and prices points to a major market top or bottom.

To improve the accuracy of their trades, traders should combine the Demand Index with other technical indicators and chart patterns.

<figure><img src="https://4186075531-files.gitbook.io/~/files/v0/b/gitbook-x-prod.appspot.com/o/spaces%2F-LD6FsRvQ3jgwJIg6O7r%2Fuploads%2FKNOlZXHoGmtpkfz9x2Vh%2FStarter_MXjC8bjRCa.png?alt=media&amp;token=68b0588a-75d2-483c-aae0-8fd4e40090da" alt=""><figcaption><p>Demand Index indicator in Quantower platform</p></figcaption></figure>


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