Poor man's volume profile

The Poor man's volume profile indicator provides a cost-effective way to visualize volume distribution across price levels over a specific lookback period directly on the chart.

Usage

The Usage section describes how the script can be used. This tool is primarily used to identify High Volume Nodes (HVN) and price levels where significant trading activity has occurred, helping traders identify potential support, resistance, and points of control.

• Identifying High Activity Zones: By looking at the horizontal bars, traders can see which price levels have seen the most volume. Longer bars represent higher volume concentration.
• Peak Analysis: The script highlights "peaks" (local maxima in volume) to help pinpoint specific price levels that act as significant magnets for price action.
• Custom Volume Analysis: Users can select a different symbol to derive volume data from, allowing for cross-asset volume comparison (e.g., using Futures volume on a Spot chart).

Details

The script operates by dividing the price range of the last X bars into 40 equal rows. It iterates through each bar in the lookback period and distributes that bar's volume across the rows it covers.

If a bar's price range (High to Low) spans multiple rows, the volume is split equally among those rows. This method provides an approximation of a traditional Volume Profile. The visualization is rendered using boxes that extend from the right side of the chart, where the width of each box is relative to the percentage of total volume found at that price level.

Settings

• Bars in profile block: Defines the lookback period (number of bars) used to calculate the volume distribution.
• Visual row width: Adjusts the maximum horizontal width of the volume profile bars on the chart.
• Show peaks: Toggles the highlighting of local volume peaks, which are displayed in a distinct color to signify key areas of interest.
• Use custom volume source: Enables the ability to pull volume data from a different ticker symbol.
• Custom volume source symbol: Specifies the ticker symbol to be used for volume calculations when the custom source option is enabled.

FAQ

How do I interpret the peaks in the profile? Peaks represent local price levels with the highest volume relative to surrounding prices. These often act as significant support or resistance levels as they represent areas where the most "work" was done by the market.

Can I change the number of rows in the profile? The current version is optimized with 40 rows to balance detail and performance; changing the row count would require a modification to the underlying code.

How can I access the Poor man's volume profile? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.