Supertrend Volume Oscillator

The Supertrend Volume Oscillator indicator integrates volume analysis with the Supertrend trend-detection mechanism to identify market sentiment and trend strength through a volume-weighted methodology.

Usage

The Supertrend Volume Oscillator oscillates between -100 and 100, providing a visual representation of how much directional volume is contributing to the total volume over a specific period.

• Market Extremes: When the oscillator enters the overbought or oversold zones (defined by the channel threshold), the background highlights the area to signal potential market exhaustion or high-conviction trends.
• Trend Direction: A green oscillator value above the zero line typically indicates bullish volume dominance, while a red value below the zero line indicates bearish volume dominance.
• Zero Line Crossovers: The horizontal zero line serves as a neutral benchmark. Crossing above or below this line can signal a shift in the dominant volume-weighted trend direction.

Details

The indicator functions by first determining the market direction using the standard Supertrend algorithm, which relies on the Average True Range (ATR) and a multiplier. Once the direction is established, it calculates "directional volume"—assigning a positive or negative value to the current volume based on the Supertrend direction.

The final oscillator value is derived from the percentage ratio of the sum of directional volume to the sum of total volume over the user-defined lookback period. This approach allows traders to see not just price trends, but the underlying volume commitment supporting those trends.

Settings

• Lookback Period: The number of bars used to calculate the summation of directional and total volume.
• Supertrend Factor: The multiplier applied to the ATR to determine the distance of the Supertrend line from price.
• Supertrend ATR Period: The period used for the ATR calculation within the Supertrend logic.
• Overbought/Oversold Levels (absolute value): Defines the percentage threshold at which the oscillator enters extreme zones.
• Show Overbought/Oversold zones: Toggles the background highlighting for the extreme market conditions.

FAQ

What does a reading of 100 or -100 mean?

A reading of 100 means that 100% of the volume over the lookback period occurred while the Supertrend was in a bullish state. Conversely, -100 means all volume occurred during a bearish state.

Why does the indicator show an error on some symbols?

The indicator requires volume data to function. If a symbol or broker does not provide volume data (common in some Forex pairs or indices), the script will display a runtime error.

How can I access the Supertrend Volume Oscillator?

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