Using PVI and NVI Divergences to Compare Volume-Linked Trends

Summary

This document describes an experimental indicator that plots divergences between the Positive Volume Index (PVI) and its exponential moving average, alongside the equivalent divergence for the Negative Volume Index (NVI). The two series are intended to help compare price activity associated with higher-volume and lower-volume sessions and may be used to identify trending activity.

The calculation updates PVI when volume rises relative to the prior period, using the previous close's rate of change; it updates NVI when volume falls, using the negated rate of change. Each index is compared with an EMA, and the difference from that EMA is plotted around a zero reference line. The page supplies an implementation adapted for ProRealTime from a TradingView version, but presents no charts, tests, or evidence of predictive performance. It calls the method experimental, and the documented code leaves the EMA period setting commented out, so users need to resolve that parameter when implementing it.

Key ideas

• PVI changes on higher-volume periods, while NVI changes on lower-volume periods.
• The indicator subtracts an EMA from each index to form two divergence series.
• Both divergence series are plotted against a zero reference for visual comparison.
• The document describes the tool as experimental and provides no performance validation.

Tags

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