Using Climactic Volume to Identify Possible Reversals and Price Zones
Summary
The document describes a volume indicator based on an idea attributed to trader Oliver Vélez. It defines a climactic volume bar as one whose volume exceeds twice the average volume of the preceding ten sessions. In an existing uptrend or downtrend, such a bar is presented as a possible sign that price may reverse. The bar can also serve as a reference when marking potential support or resistance areas.
The included indicator logic compares current volume with that threshold, highlights qualifying volume, and separates the remainder for display. The document offers no chart examples, market-specific guidance, backtest, or evidence that these bars predict reversals reliably. A volume spike alone should therefore be treated as a reference signal rather than a validated trading rule.
Key ideas
- A climactic volume bar is defined as current volume exceeding twice the average of the previous ten sessions.
- The document presents such a bar during an uptrend or downtrend as a possible reversal signal.
- Climactic volume bars may help mark potential support or resistance areas.
- The indicator highlights volume above the threshold and does not provide validation of its predictive value.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.