The formula to calculate the Distribution Days Percentage (D) is:
\[ D = \left( \frac{S}{T} \right) \times 100 \]
Where:
A distribution day is a trading day when a significant decline in the market occurs, typically characterized by a drop in major stock indices such as the S&P 500 or NASDAQ. This decline is often accompanied by higher trading volumes, indicating that institutional investors are selling off their positions. Distribution days are used by traders and investors to gauge the health of the market and to identify potential trends or reversals. A high number of distribution days within a short period can signal a weakening market and potential downturn.
