Volume Price Confirmation Indicator: Components and Calculation
Summary
The document describes the Volume Price Confirmation (VPCI) indicator, which is intended to express how price and volume relate. It identifies fast and slow moving-average periods as inputs and defines VPCI as the product of three components: a price confirmation term, a volume-price ratio, and a volume multiplier. These terms compare volume-weighted and simple averages across the selected periods.
The formula gives a conceptual recipe for combining price weighting with relative volume, but the notation is abbreviated: it does not fully specify the averaging conventions or explain how to interpret positive and negative values. No trading rules, parameter guidance, chart examples, or performance evidence are included. The indicator description therefore supports understanding its construction, while leaving validation and practical use to further research.
Key ideas
- VPCI is presented as an indicator of the relationship between price and volume.
- Its calculation multiplies a price confirmation component, a volume-price ratio, and a volume multiplier.
- The indicator takes fast and slow moving-average periods as inputs.
- Its components compare volume-weighted and simple price averages alongside volume across periods.
- The document gives a formula but no trading rules or performance evidence.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.