Volume on Candles + Alerts

The Volume on Candles + Alerts indicator is a visualization tool that colors price bars based on relative volume intensity, allowing traders to quickly identify periods of significant market participation.

Usage

The indicator can be used to gauge the conviction behind price movements by observing the color of the candles. Traders often look for high-volume candles (Extra High or High) to confirm breakouts or potential reversals, while low-volume candles might suggest a lack of interest or consolidation.

Key usage examples include:

• Trend Confirmation: Identifying strong moves where price action is accompanied by yellow, orange, or red candles.
• Exhaustion Identification: Spotting "Extra High" (red) volume candles at the end of a long trend, which may indicate a climax and potential reversal.
• Breakout Validation: Using volume thresholds to confirm if a level breach has the necessary momentum to sustain the move.

Details

The script calculates volume intensity by comparing the current volume to its historical average using a Z-score approach (Standard Deviation). It calculates a Simple Moving Average (SMA) and the Standard Deviation of volume over a user-defined length.

The resulting "stdBar" value represents how many standard deviations the current volume is away from the mean. Based on this value, the script categorizes volume into five distinct levels:

• Extra High (Red): Volume significantly above the mean (determined by the Extra High Threshold).
• High (Orange): Volume moderately above the mean.
• Medium (Yellow): Volume slightly above the mean.
• Normal (White/Chart Foreground): Volume near the average.
• Low (Aqua/Blue): Volume below the normal threshold.

Settings

• MA Volume Length: Determines the lookback period used to calculate the volume average and standard deviation.
• Extra High Volume Threshold: The standard deviation multiplier required to trigger the "Extra High" volume color and alerts.
• High Volume Threshold: The standard deviation multiplier required to trigger the "High" volume color and alerts.
• Medium Volume Threshold: The standard deviation multiplier required to trigger the "Medium" volume color and alerts.
• Normal Volume Threshold: The standard deviation multiplier required to trigger the "Normal" volume color. Values below this trigger the "Low" volume color.

FAQ

How do I use the alerts with this indicator?

You can set up alerts for specific volume intensities (Extra High, High, Medium) and further filter them by the bar direction (Up or Down) through the TradingView Alert menu.

Can I change the colors of the candles?

While the logic is fixed to specific categories, the visual output can be modified in the "Style" tab of the indicator settings to match your personal chart theme.

How can I access Volume on Candles + Alerts?

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