RVR Resistance: Candle Range per Unit of Volume

Summary

This indicator estimates price resistance using candle size and tick volume. It can measure candle movement as either the open-to-close difference or the high-to-low range, then divide that measure by volume to estimate lower resistance. Reversing the ratio estimates higher resistance. A smoothed moving average of the resulting histogram forms a signal line, with a selectable averaging method.

Minimum candle-size and volume thresholds filter small observations. When a bar falls below a threshold, the threshold value is used in place of its actual measurement. Histogram columns can use a single color or be colored according to the preceding column’s position relative to the signal line. The document describes the indicator’s formulas and settings but provides no performance tests or trading rules. Its resistance readings therefore remain a derived price-volume measure, and the text does not establish that they predict future price behavior.

Key ideas

• The indicator compares candle range or open-to-close movement with tick volume.
• Reversing the ratio changes the calculation from a lower-resistance measure to a higher-resistance measure.
• A moving average of the ratio values serves as the signal line.
• Minimum range and volume settings substitute threshold values for smaller observations.
• The document explains construction and display options but gives no evidence of predictive performance.

Tags

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