A trading signal that analyzes buying and selling pressure within price candles by estimating volume distribution and calculating the delta volume between buyers and sellers.
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The script calculates buying and selling pressure by analyzing volume distribution within each price candle. It estimates the proportion of volume attributed to upward and downward price movements, considering the candle's high, low, and close prices.
By measuring the spread between candle prices and mapping volume proportions, the indicator determines buying pressure (volume moving price up) and selling pressure (volume moving price down). The delta volume is then computed as the difference between these two pressure measurements, providing insight into net market sentiment.
Why it may be useful
Understanding buying and selling pressure helps traders gauge market dynamics and potential trend strength or weakness. By visualizing volume distribution, traders can identify whether bulls or bears are currently controlling price movement and assess the momentum behind each candle.
The delta volume provides a clear representation of market sentiment, allowing traders to detect potential trend reversals or confirm existing market trends. This information can be crucial for making more informed trading decisions by revealing the underlying buying and selling forces driving price action.
When to explore it
This signal works best in markets with clear volume data and during periods of active trading with significant price movements. It is particularly useful in identifying potential trend changes, confirming existing trends, and understanding market sentiment during volatile market conditions.
Traders should apply this indicator in liquid markets with high trading volumes, such as major forex pairs, stock indices, and actively traded commodities. It is most effective when used in conjunction with other technical analysis tools to validate signals and provide comprehensive market insights.
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What we’ve verified
Access, alerts and repainting behaviour have not been independently verified for this indicator. Check the creator’s current publication and settings.
General descriptions and classifications are recovered research. Verified details above identify the specific checks we have completed. Check the creator’s current publication for later changes.
