Equivolume Volume Bars Scaled by Recent Trading Activity

Summary

This chart overlay represents each bar's volume as a box whose horizontal width varies with volume relative to a recent rolling total. It places these boxes beside price bars and colors them according to whether the corresponding candle closed up or down. A volume moving average, selectable as a simple, exponential, or weighted average, is drawn across the boxes to show how activity changes over time.

The display is designed to accompany an equivolume chart, with controls for the number of historical boxes, volume lookback, width scaling, and moving-average settings. The author says the boxes are read like ordinary volume bars, with their adjusted widths matching the companion display. The publication reports a practical limitation: large volume variation can make boxes extend beyond chart drawing limits, especially on short timeframes; reducing the full-width setting can help. This is a visualization aid, not a trading signal or evidence that volume predicts returns.

Key ideas

• Box width scales with current volume relative to a recent volume total.
• Box height represents volume, while color indicates whether price closed above or below its open.
• A configurable volume moving average can use simple, exponential, or weighted smoothing.
• The overlay is intended to align with equivolume price displays and is read as a volume display.
• Large volume spikes may exceed chart drawing limits, so width scaling may need adjustment.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.