Measuring Candle Range or Body Relative to Tick Volume

Summary

The document explains a histogram indicator that divides a candle's price movement by its tick volume. It offers two calculation choices: the absolute difference between open and close, which measures the candle body, or the difference between high and low, which measures the full range. In both cases, each candle's result is normalized by that candle's tick volume.

This ratio can be used to inspect how much price movement occurred relative to trading activity recorded as ticks. The document supplies the formulas and identifies tick volume as the denominator, but it does not give interpretation rules, thresholds, trading signals, or empirical results. Because tick volume counts price updates rather than necessarily representing centralized traded volume, its meaning may vary across instruments and data providers. The indicator is therefore a descriptive measure whose usefulness would depend on market context and validation.

Key ideas

• The indicator plots a per-candle price movement divided by tick volume.
• The open-close option measures candle body size using the absolute price difference.
• The high-low option measures the full candle range.
• The document gives formulas but no signal rules or evidence of trading performance.
• Tick volume may not correspond to centralized traded volume across markets.

Tags

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