{"id":12185,"date":"2026-05-22T13:38:20","date_gmt":"2026-05-22T13:38:20","guid":{"rendered":"https:\/\/lemonn.co.in\/blog\/glossary\/chaikin-money-flow\/"},"modified":"2026-05-22T13:38:20","modified_gmt":"2026-05-22T13:38:20","slug":"chaikin-money-flow","status":"publish","type":"glossary","link":"https:\/\/lemonn.co.in\/blog\/glossary\/chaikin-money-flow\/","title":{"rendered":"Chaikin Money Flow"},"content":{"rendered":"<p><a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/chaikin-money-flow\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Chaikin Money Flow<\/a>, or CMF, is an indicator developed by Marc Chaikin to measure the amount of money flowing into or out of a security over a specified period. It improves on On Balance <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/volume\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Volume<\/a> by considering where the close falls within the day&#x2019;s range, not just whether it was higher or lower than yesterday. CMF oscillates above and below zero and is a favourite of Indian swing traders looking for accumulation or distribution.<\/p>\n<div><strong>Key takeaways:<\/strong>\n<ul>\n<li>CMF measures money flow over a defined window (default 20 periods).<\/li>\n<li>Above zero suggests net buying pressure; below zero suggests net selling.<\/li>\n<li>Sustained CMF readings above +0.1 indicate strong accumulation.<\/li>\n<li>Readings below &#x2212;0.1 indicate strong distribution.<\/li>\n<li>Best combined with price-trend analysis for confirmation.<\/li>\n<\/ul>\n<\/div>\n<h2 id=\"how-cmf-is-calculated\">How CMF is calculated<\/h2>\n<p>For each period: Money Flow Multiplier = ((Close &#x2212; Low) &#x2212; (High &#x2212; Close)) &#xF7; (High &#x2212; Low). This is between &#x2212;1 and +1. Multiply by volume to get Money Flow Volume. Sum over N periods and divide by sum of volume to get CMF.<\/p>\n<h2 id=\"interpreting-cmf-readings\">Interpreting CMF readings<\/h2>\n<ul>\n<li><strong>CMF &gt; 0.05:<\/strong> Net buying interest; <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/bullish\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">bullish<\/a> bias.<\/li>\n<li><strong>CMF &lt; &minus;0.05:<\/strong> Net selling interest; <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/bearish\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">bearish<\/a> bias.<\/li>\n<li><strong>Crossing zero:<\/strong> Possible change in money-flow direction.<\/li>\n<li><strong>Divergence:<\/strong> Price highs without CMF highs hint at hidden distribution.<\/li>\n<\/ul>\n<h2 id=\"cmf-vs-obv-vs-mfi\">CMF vs OBV vs MFI<\/h2>\n<table>\n<tr>\n<th>Indicator<\/th>\n<th>What it does best<\/th>\n<\/tr>\n<tr>\n<td>OBV<\/td>\n<td>Cumulative volume direction<\/td>\n<\/tr>\n<tr>\n<td>MFI<\/td>\n<td>Volume-weighted overbought\/oversold<\/td>\n<\/tr>\n<tr>\n<td>CMF<\/td>\n<td>Volume-weighted accumulation\/distribution over a fixed window<\/td>\n<\/tr>\n<\/table>\n<h2 id=\"worked-example\">Worked example<\/h2>\n<p>A stock is in an uptrend with prices making higher highs. CMF stays consistently above +0.1 &#x2014; confirmation that institutional money is buying. When CMF eventually drops below zero while price still attempts new highs, the divergence is a yellow flag worth watching.<\/p>\n<h2 id=\"settings-to-consider\">Settings to consider<\/h2>\n<ul>\n<li>Default 20 works for daily charts.<\/li>\n<li>Intraday traders use 10 to make the indicator more responsive.<\/li>\n<li>Long-term investors apply CMF on weekly charts with periods of 21&#x2013;34.<\/li>\n<\/ul>\n<h2 id=\"limitations\">Limitations<\/h2>\n<p>CMF treats every trade equally regardless of size beyond raw volume. Pre-open auction bars and one-off block deals can skew the indicator. Use CMF alongside trend tools and avoid making decisions on a single spike.<\/p>\n<h2 id=\"frequently-asked-questions\">Frequently asked questions<\/h2>\n<div>\n<h3 id=\"is-cmf-good-for-nifty-50-stocks\">Is CMF good for <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/nifty\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">Nifty<\/a> 50 <a class=\"glossaryLink\" href=\"https:\/\/lemonn.co.in\/blog\/glossary\/stocks\/\" data-gt-translate-attributes='[{\"attribute\":\"data-cmtooltip\", \"format\":\"html\"}]' tabindex=\"0\" role=\"link\">stocks<\/a>?<\/h3>\n<p>Yes, particularly the high-volume names where volume data is reliable.<\/p>\n<h3 id=\"what-is-a-strong-cmf-reading\">What is a strong CMF reading?<\/h3>\n<p>Above +0.25 is unusually strong accumulation; below &#x2212;0.25 is heavy distribution.<\/p>\n<h3 id=\"can-cmf-be-used-as-a-stand-alone-signal\">Can CMF be used as a stand-alone signal?<\/h3>\n<p>Most traders use CMF as a confirmation tool, not for primary entry.<\/p>\n<h3 id=\"does-lemonn-s-charting-tool-support-cmf\">Does Lemonn&#x2019;s charting tool support CMF?<\/h3>\n<p>Yes &#x2014; CMF is a standard indicator across modern Indian charting platforms.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Chaikin Money Flow, or CMF, is an indicator developed by Marc Chaikin to measure the amount of money flowing into or out of a security over a specified period. It improves on On Balance Volume by considering where the close falls within the day&#x2019;s range, not just whether it was higher or lower than yesterday. [&#x2026;]<\/p>\n","protected":false},"author":3,"featured_media":0,"menu_order":0,"template":"","meta":{"_uag_custom_page_level_css":"","footnotes":""},"class_list":["post-12185","glossary","type-glossary","status-publish","hentry"],"blocksy_meta":[],"uagb_featured_image_src":{"full":false,"thumbnail":false,"medium":false,"medium_large":false,"large":false,"1536x1536":false,"2048x2048":false,"web-stories-poster-portrait":false,"web-stories-publisher-logo":false,"web-stories-thumbnail":false},"uagb_author_info":{"display_name":"Team Lemonn","author_link":"https:\/\/lemonn.co.in\/blog\/author\/ashu\/"},"uagb_comment_info":0,"uagb_excerpt":"Chaikin Money Flow, or CMF, is an indicator developed by Marc Chaikin to measure the amount of money flowing into or out of a security over a specified period. It improves on On Balance Volume by considering where the close falls within the day&#x2019;s range, not just whether it was higher or lower than yesterday.&hellip;","_links":{"self":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/12185","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary"}],"about":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/types\/glossary"}],"author":[{"embeddable":true,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/users\/3"}],"version-history":[{"count":0,"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/glossary\/12185\/revisions"}],"wp:attachment":[{"href":"https:\/\/lemonn.co.in\/blog\/wp-json\/wp\/v2\/media?parent=12185"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}