The MFI - Your Money's Secret Directional Map

The Money Flow Index has saved my ass more times than I'd like to admit. It's not just some fancy technical indicator—it's the damn truth serum for markets, showing where money's really flowing while everyone else is just guessing.

I've spent countless nights staring at MFI readings when prices were telling a completely different story. Trust me, when you see MFI dropping while prices climb, you better get your exit strategy ready. The smart money is already heading for the door while retail traders are still piling in.

The thing works on a 0-100 scale, and here's what nobody tells you: that "standard" 14-day period? Complete BS for volatile markets. I've had much better results tweaking it to 7 days during crazy swings.

Everyone focuses on the 80/20 overbought/oversold levels, but the real magic happens at 50. Cross above, money's flowing in. Drop below, cash is bleeding out. Simple as that.

What pisses me off is how many traders rely solely on price action when volume tells the actual story. The MFI captures both—it's like having X-ray vision into market sentiment.

The calculation seems complex but boils down to this: typical price × volume shows you the raw money flow, then we separate positive from negative flows. The ratio between them exposes what's really happening beneath the surface.

I've caught several reversals early just by spotting MFI divergences—when price makes new highs but MFI doesn't confirm. Those moments are golden for contrarian plays.

Of course, no indicator is perfect. I've been burned following MFI signals in illiquid markets where a few big players can manipulate the readings. You've got to combine it with other tools.

Bottom line—if you're not watching where money's actually flowing, you're trading blind. The price might lie, but money movement rarely does.