A Volume Average Breakout Indicator for Manual Trading
Summary
The document describes a volume histogram indicator designed to make unusually active bars easier to notice. It compares each bar's volume with a moving average over a user-selected number of past bars. Bars below the average appear in pale colors, while a move above the average is highlighted; the indicator uses green when price is trending upward and red when trending downward. Users can choose real volume or tick volume as the input.
The stated purpose is to support manual traders who may miss a volume surge while monitoring a chart. The description offers no performance study, entry or exit rules, or evidence that above-average volume predicts a profitable move. It explicitly cautions that the price direction color can misrepresent buying and selling pressure: elevated volume may be absorbed by sellers and accompany a decline. The signal is therefore a visual aid to interpret alongside other tools, including tape reading and the trader's broader system.
Key ideas
- The indicator compares bar volume with a moving average based on a chosen lookback.
- Bars above the average are highlighted, with color based on the apparent price trend.
- The user can select real volume or tick volume.
- Above-average volume does not establish the direction of underlying buying or selling pressure.
- The description presents a manual chart aid without performance results or complete trading rules.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.