Volume Delta Candles
Apr 11, 2024
Volume Delta Candles offers traders unique insights into intrabar trading activity with an easy-to-understand visual format. This tool leverages lower timeframe or real-time data to display the Volume Delta percentage against the total volume as a colored segment of each bar. Additionally, the script highlights the price level within each bar that exhibits the most trading activity, supplemented by other pertinent information.
How to Trade with Volume Delta Candles?
The Volume Delta Candles tool emphasizes intrabar volume, providing enhanced visibility into the trading action encapsulated in a candle. This allows traders to evaluate activity without needing a separate volume indicator.
Each component of the indicator is elaborated below:
Understanding Volume Delta
Volume Delta is calculated based on the difference between buy and sell volumes, where buy volume corresponds to a bullish intrabar candle, and sell volume to a bearish one. A Positive Volume Delta appears as a green section in the candle, while a Negative Volume Delta is shown in red.
Interpreting Bar Colors
This script visualizes Volume Delta (VD) as a percentage relative to the entire or partial candle, depending on the set 'Display'. The coloration possibilities for bars are:
- Full (100%) when 'Display' is set to 'Full Bar'
- Half (50% or 100% of half a bar) when 'Display' is configured at 'Half Bar'
A negative VD (indicating more sell than buy volume) fills the bar from the top (or middle) downwards, and a positive VD fills it upwards, starting at the bottom (or centre).
Interestingly, a negative VD on a green candle displays as a red VD within a green-bordered candle, and vice versa for a positive VD on a red candle, shown by a green VD inside a red-bordered candle.
VD sentiment colors opposed to candle sentiment can be customized if desired, offering traders visual flexibility.
Highlighting the Highest Volume Price Level
The script identifies and marks the intrabar price level with the highest volume using a white (or black in light mode) line.
When the 'Show Previous Max Volume Price' feature is activated, a dot appears one bar to the right of the current bar, marking the previous highest volume price level.
Detailed Insights
Tick or Lower Time Frame (LTF) Data
Our initial example utilized Lower Time Frame (LTF) data.
In the following example, we use real-time tick data (Settings -> Data From)
Both data versions, LTF and tick data, depict a vertical dotted line indicating where data generation begins.
Adjusting LTF Settings
When selecting 'Data from' LTF and 'Auto' is enabled, the LTF selected is the nearest possible smaller timeframe than the current one. If 'Premium' is unchecked, setting the minimum timeframe to 1 minute ensures compatibility with TradingView non-Premium plans.
For instance, the Current Daily TF illustrates:
- 500 : 3-minute LTF
- 1500 (default): 1-minute LTF
- 5000: 30 seconds LTF (default to 1 minute if Premium is off)
Additional Notes
- Different LTF settings provide variations in data, not indicating inaccuracy but rather different analytical perspectives.
(View LTF at the top right corner)
- For optimal value visibility, we advise utilizing Bars from the Bar's style menu.
Tailoring Your Indicator
- Data from: Choose between Lower TimeFrame or real-time Tick data
- Resolution: Configure the LTF settings
- Auto + multiple: Fine-tune the initial resolution
- Premium: For users with a Premium or higher TradingView plan
Intrabar Analysis Options
- Color Configuration
- Display: Choose between Full or Half bar
- Display past max volume price: Mark previous highest volume price level with a dot
Table Options
- Show Time Frame: Display LTF at the top corner
- Customize colors and table text size
Detailed Display Options
- Display details: Labels showing 'Volume', 'Delta' (VD), and percentages
Refer to How to Trade with Volume Delta Candles? for in-depth understanding.
FAQ
Q: How do I access the Volume Delta Candles indicator? You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.
Q: Can I configure the color settings? Yes, the indicator allows custom color settings to align with your preferences.
Q: Is a Premium account required to fully utilize this tool? While Premium features enhance functionality, the indicator is usable with non-Premium plans, with some adjustments.
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