Inertia is one of forex technical indicator used by many traders in forex technical analysis. Inertia is defined in terms of massand direction of motion. Using technical analysis to analyze securityprices, the direction of motion is easily defined.

A scale that Inertia is measured on is from 0 to 100. If the indicator is below 50 the Inertia is seen to be negative. Positive Inertia is supposed to have the indicator above 50. Positive inertia signs show a long-term upward trend whether long-term downtrends are indicated by negative Inertia.

The inertia indicator was developed by Donald Dorsey and is an outgrowth of Dorsey’s relative volatility index. The name inertia was chosen because of his definition of a trend. He states that a trend is simply the “outward result of inertia.” It takes significantly more energy for a market to reverse direction than to continue along the same path.

Therefore, a trend is a measurement of market inertia. Dorsey asserts that volatility may be the simplest and most accurate measurement of inertia. The inertia indicator is simply a smoothed RVI [Relative Volatility Index]. The smoothing mechanism is a linear-regression indicator.