This shows that the buyers are anxious to get on board and large volume enters the market and bids up prices quickly. A valid breakout should be followed by more buying but occasionally the low of the Volume Climax bar is tested. The beginning of a down trend is almost always marked by a Low Churn bar. This shows there is no demand to support price and it quickly collapses, resulting in a low volume but large range bar. As the market rises strongly, amateur traders start chasing prices higher. Some will buy at market, others place resting buy orders. As the move gathers momentum the buy orders will be progressively pulled up, until there is a long “tail” of resting buy orders.
The large player «has just pushed out» from the market small volumes − has collected StopLoss of those who on this bar have hurried to open sale. To avoid a similar mistake, it is necessary to analyze volumes before still emergence of key bar on the histogram of the indicator of volumes. If the general level of volume low (there is nobody to support the strong descending movement!) that what is forex will be dangerous to open new transactions for sale. Low Volume bars are identified by looking for the lowest volume in the last 20 bars . Low Volume bars indicate a lack of demand at tops or a lack of supply at bottoms. Market tops are characterized by Volume Climax, High Volume Churn and Low Volume patterns. The most common pattern is Volume Climax followed by High Volume Churn.
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Market bottoms are characterized by Volume Climax Down bars, High Volume Churn and Low Volume Down bars https://en.wikipedia.org/wiki/Stock_market_bubble . Market tops are characterized by Volume Climax Up bars, High Volume Churn and Low Volume Up bars .
The volume of transactions or the amount of money that participants pour into the market is the main effort to create a movement, and price is the end result of this process. They create optimal market price, and synchronous trade together with them considerably increases chances of success for any trader. Volume appears in the form of colored bars in a sub MT4 window underneath the main trading chart. Try This BETTER VOLUME NinjaTrader indicator in your NT platform. Look at our tutorial article on installing NinjaTrader indicators if you are not sure how to add this BETTER VOLUME into your NT platform.
Better Volume Indicator Forex
Be sure to verify that any information you see on these pages is correct, and is applicable to your particular trade. In no case will be responsible for your trading gains or losses. Violet or purple is a rather rare signal that confirms the current trend.
For additional information on the Relative Volume indicator, please refer to this blog post. With your general methodology and Better Volume indicator my calls on the market have been stellar. In 20 years of trading I’ve never been so attuned with an indicator immediately. Better Volume is really great … I got rid of other unnecessary and useless indicators … Thank you for Better Volume, the most valuable indicator to me. Remember, this method of identifying turning points using volume is even more powerful when combined with non-correlated indicators, such as the Hilbert Sine Wave.
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This does not necessarily represent a possible turning point, but is more likely just to be high volume from day traders closing out positions. After hours signals are also suspect unless there is good volume being traded.
I just started using this indicator as I learn more about the usefulness of volume movement and I really like it. It seemed to me that separate Up/Down Climax bars might be the way to go, but as you’re the creator, I thought you might have more better volume indicator insight. Or perhaps it would have been just a pain in the “Tail” to program, so to speak. Please could you tell me what is classed as high volume on this indicator ? for example is it set at 5% above the average volume over x amount of days?
This either occurs alone or with High Volume Churn or Low Volume bars. The Low Volume Churn bar happens when the market spikes down, with large range but very little volume. When a bottom is approaching, this could be professionals “testing” to see if there is more supply present. Watch to see if the market continues down or stops and reverses. A low volume bar is a bar which has a lower volume than for all preceding bars of the lookback period. If there are no serious volumes, the histogram is coloured in basic blue colour. As the complementary filter is used by MA − at intersection of the line the histogram signal intensity increases.
Spread The full range of the bar ; it is believed that there are three types − wide narrow and medium, calculated in relation to the previous bars . The spread shows, how actively there are biddings in a current period. Futures, foreign currency and options trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing one’s financial security or lifestyle. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.
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I have no pine script knowledge but I could change the number if given an idea of what is what . The stock market basics, in my opinion, is the best volume indicator bar none. I add to it the Donchian Channel and the Aroon indicator tho confirm buy or sell as well as taking profit and it performs awesomely. Pullbacks, in either up or down trends, are similar to market topping or bottoming patterns, but shorter in duration and with simpler volume patterns. Volume has to be the most underrated market variable used in technical analysis. But if you know how to analyze and interpret it, you’ll be able to see market turning points develop and anticipate pullbacks and trend changes. Through the dynamics of volumes and their ratio with spreads, the trader must correctly assess the interest of market makers and large participants in order to use them in their trade.
Boy if people really would understand the power of this indicator. Not only does it show where smart money is accumulating and distributing it also is fantastic at identifying where bots are absorbing transactions. Volume is the only thing that precedes price, the ONLY thing. Even the Smart money and bots can not hide how to start day trading what they are doing. The VSA signal is a relatively low volume of trades with a small spread after strong directional movement. VSA technique purpose − in time to see the moments and the direction of an input in the market of professional players − those who have the most up-to-date information and potential.
The beginning of an up trend is almost always marked by a Volume Climax Up bar. A valid breakout should be followed by more buying but occasionally the low of the Volume Climax Up bar is tested. Bullish volume − a synchronous growth in volume on green bars and a decrease in the red, that is, there are buyers better volume indicator on the market ready to continue buying at a price increase. This means that large players on green candle bars − always buy, and on red − do not sell. Bearish volume − growth in volume on red bars and a decline in green. This means that large players on green bars − do not buy, but on red − necessarily sell.
- There is either a bug in the code or the indicator is not compatible with build 2560.
- High Volume Churn bars are identified by dividing volume by the bar’s high to low range and then looking for the highest value in the last 20 bars .
- Market bottoms are also characterized by Volume Climax Down bars often with High Volume Churn and/or Low Volume test patterns.
- Histogram indicator each bar shows the last spread, which is additionally indicated in the information board on the right .
- The end of a bullish trend or correction is accompanied by large volumes and a strong bearish candle.
- The Volume Spread Analysis trading method revealing manipulations and transactions of «smart money», promptly gains popularity.
- But, despite the listed problems, professional traders widely use volume instruments in trading strategies, or as they are also called psychological indicators, for a general assessment of market sentiment.
It measures volume and range over a lookback period of 20 bars. For intraday charts the volume progression after the opening of the market does not give any signals, because it is natural. So you need at least 10 to 15 bars into the regular session to use this indicator. Changes in trend usually take a while to develop, so don’t be suckered in too soon – wait for the market to become exhausted. When there are no volume signals the default histogram bar coloring is cyan.