Volume Profile Histogram

The Volume Profile Histogram indicator provides a bell-curve style distribution of trading volume over a specified lookback period, categorizing data into buying and selling volume to identify precise areas of market interest. It offers a comprehensive view of price-volume relationships by highlighting independent Points of Control (POC) for both bullish and bearish activity.

Usage

The Usage section describes how the script can be used to analyze market structure and volume distribution.

• Identifying Sentiment Concentration: The indicator breaks down volume based on bar polarity (Bullish: Close > Open; Bearish: Open > Close). This allows users to see not just where volume is high, but whether that volume was predominantly driven by buying or selling pressure.
• Dual Points of Control (POC): Unlike standard profiles, this tool identifies two POCs. A Bullish POC (purple) highlights the price range with the highest buying volume, while a Bearish POC (yellow) identifies the highest selling volume. If these levels are far apart, it can indicate a trend; if they coincide, it may signal a major support or resistance zone.
• Volume-Based Range Analytics: This feature displays how price range (ATR) correlates with volume levels. For example, in some assets, low volume might correlate with bearish movement, while high volume correlates with bullish movement, helping traders understand the "fuel" behind price moves.
• Frequency Analysis: Using the frequency table, traders can see how many times price visited specific ranges, helping to differentiate between high-volume "spikes" and sustained price consolidation.

Details

The script executes by capturing price and volume data over a user-defined lookback period (default 252 bars). It segments the price range between the period's high and low into ten equal buckets based on standard deviation intervals.

As the script iterates through the history, it assigns volume to the corresponding price bucket. If the bar is bullish, the volume is added to the bullish sum for that bucket; if bearish, it is added to the bearish sum. The histogram displays these cumulative sums as percentages relative to the total buying or selling volume within the entire lookback period. This statistical approach helps visualize the "Bell Curve" of market activity, revealing where the most significant accumulation and distribution has occurred.

Settings

• Lookback Length: Sets the number of bars to include in the volume profile calculation.
• Show Start and End Time: Toggles the display of the data collection dates on the dashboard.
• Show Bullish and Bearish POC: Enables or disables the horizontal labels identifying the price ranges with the highest buying and selling volume.
• Show Frequency Table: Displays a table showing the count of occurrences (frequency) of price within each bucket.
• Show Range Analytics by Volume: Toggles a separate chart/table showing the average price range associated with different volume intensities.

FAQ

How do the POCs differ from standard Volume Profile POCs? Standard profiles calculate the highest total volume. This script calculates two separate POCs based on bar direction, allowing you to see if buyers and sellers are focused on the same or different price levels.

Can I use this on intraday timeframes? Yes, while the default is 252 (one trading year on the Daily timeframe), you can adjust the lookback length to suit any timeframe, such as 20 periods for a shorter-term view.

How do I access the Volume Profile Histogram? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.