Indicator: Weis Wave Volume

The Weis Wave Volume [LazyBear] indicator organizes market volume into cumulative wave charts to clearly identify trend inflection points and significant regions of market supply and demand.

Usage

The indicator is primarily used to analyze the total volume committed to a specific price movement, allowing traders to see the "force" behind a trend. Instead of viewing volume bar-by-bar, it aggregates volume as long as the price continues in a specific direction, creating a "wave" of volume.

• Trend Strength: Large volume waves typically confirm the strength of a price trend, suggesting high participation.
• Trend Exhaustion: Diminishing volume waves during a price trend (divergence) can signal that the move is losing momentum and may be nearing a reversal.
• Supply/Demand Zones: Massive volume waves that fail to push price significantly further can indicate absorption or a climax, highlighting potential support and resistance areas.

Traders can adapt the indicator to different timeframes and assets by adjusting the trend detection sensitivity. This helps in filtering out "noise" or minor price fluctuations to focus on larger market cycles.

Details

The concept behind this indicator is based on David Weis’s application of Wyckoffian principles, specifically the relationship between effort (volume) and result (price). By accumulating volume into waves, the script visualizes the cumulative effort of buyers versus sellers over a period.

The script monitors price movement to determine the current wave direction. A wave continues to accumulate volume until a reversal in price—defined by the user's detection length—is confirmed. At that point, the cumulative volume is reset, and a new wave begins in the opposite direction. While traditional volume is displayed per candle, Weis Wave Volume provides a macro view of participation within price swings.

Settings

• Trend Detection Length: Determines the sensitivity of the trend reversal logic. A higher value requires a more significant price move to start a new volume wave, effectively smoothing the output and grouping minor waves together.
• Show Distribution Below Zero: When enabled, bearish volume waves are plotted as negative values below the zero line, creating an oscillator-style display. When disabled, both bullish and bearish waves are plotted above zero for easier visual comparison of magnitude.

FAQ

What does a sudden spike in the volume wave indicate?

A spike indicates a large amount of volume has been transacted during the current price swing. This often represents a "climax" or a surge in participation that may precede a trend pause or reversal.

Can this indicator be used on Forex?

Because the script relies on volume data, it is most effective on instruments with centralized volume data like Stocks, Futures, and ETFs. On Forex, it will use "Tick Volume," which may vary between different data providers.

How do I access the indicator?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.