top of page

Volumes forex indicator

After price itself, volume might be the second most important information we can get from the market. This extremely powerful tool is often neglected because of its simplicity. But it is a mistake. Volumes forex indicator can be used to improve profitability while decreasing risk of almost any forex trading strategy.

Volumes forex indicator

For the best results, trade with professional ECN/STP broker with MT4. If you can't trade with profit. Automatically copy the traders that are already profitable.

Transaction (struggle for dominance) between buyers and sellers creates price movement on forex market.

Activity of bulls and bears – effort. reveals itself as volumes. Result of the efford reveals itself as price movement.

High forex volume also indicates high participation of traders at price level. This may be caused by market preparing for new substantial movement that involves important market players. On the other hand, low volumes is clear sign of uninterested and hesitance of big forex players in current instrument price.

In decentralised forex market, it is nearly impossible to get accurate volume readings. Volumes indicator therefore represents tick volume (number of ticks at price bar) and it can vary from broker to broker.

Using Volumes forex indicator

Trend health indicator. In healthy trend, volumes should generally rise as trend progresses, this signalises involvement of wider public, and growing interest of financial institutions. There is always necessary to compares volume to the price itself.

Volumes forex indicator

Moving Averages plotted over Volumes indicator window can help us to determine diminishing activity in trend continuation. In this picture EMA 14 (red) and 40 (black) were used.

Effort (activity - volumes) and result (price movement). While extreme candle on wide bullish candle signalise continuation, same extreme volume on flat candle may signalise preparation for substantial trend reversal.

Volumes forex indicator

Extreme volume and wide candle - continuation. Same volume with flat candle - reversal.

Breakout confirmation. Breakout on low volume, signalise low involvement of traders. You may just be one of the couple of traders that noticed the breakout. High volume on breakout candle, confirms new price direction in most of the cases. Comparing volume with candle formation, can be one of the most profitable tools of technical analysis.

Volumes forex indicator

Never trust a breakout on low volume. It usually is just s fakeout. Good news is you can also trade fakeout strategy.

VOLUMES forex strategies

ABOUT US

THEFOREXKINGS

“Trading FOREX since 2006. Full time trader and web developer since 2013. My two biggest hobbies are trading and web development. In TheForexKings I managed to connect both of them. Even after 12 years of trading I still have the same passion for the market as at the beginning. The aspect I enjoy the most : development and testing of new ideas.” 

 

Only in 2016 - 2017 we have created more than 400 forex strategies. During this period we have also developed and published +200 MT4 Expert advisors based on those strategies. We are dedicated to provide you with viable and complete trading systems that have thrived in extensive historical testing. We want to give you complete and transparent trading solutions, that once mastered ,will set you financially free. We want to give you a fighting and winning chance in the market. ” 

—  Marian, Proprietor of TheForexkings.com

bottom of page