Dix$on's Weighted Volume Flow

7 godzin temu

Dixson's Weighted Volume Flow

Dixson's Weighted Volume Flow is a technical indicator designed to analyze and visualize the distribution of buy and sell volume within a given timeframe. It dynamically calculates the proportional allocation of volume based on price action within each bar, providing insights into market sentiment and activity. This indicator displays horizontal volume bars in a separate pane and annotates them with precise volume values.

How It Works

1. Volume Allocation:
- The indicator calculates buy and sell volume using the following formulas:
- Buy Volume = (Close - Low) / (High - Low) Total Volume
- Sell Volume = (High - Close) / (High - Low) Total Volume
- These formulas allocate volume proportionally based on the bar's price range, attributing more volume to buying or selling depending on the relationship between the close, high, and low prices.

2. Dynamic Scaling:
- The buy and sell volumes are scaled relative to their combined total for the period.
- The resulting values determine the length of the horizontal bars, providing a comparative view of buy and sell activity.

3. Bar Visualization:
- Buy Volume Bars: Displayed as green horizontal bars.
- Sell Volume Bars: Displayed as red horizontal bars.
- The lengths of the bars represent the dominance of buy or sell volume, scaled dynamically within the pane.

4. Labels:
- Each bar is annotated with a label showing its calculated buy or sell volume value.

5. Timeframe Adjustment:
- The indicator uses the request.security() function to fetch data from the selected timeframe, allowing users to customize their analysis for intraday, daily, or longer-term trends.

6. Customization Options:
- Enable or disable the indicator using a toggle.
- Adjust colors for the buy/sell bars and text labels to suit your chart theme.


How to Use It

1. Enable the Indicator:
- Activate the indicator using the "Enable/Disable" toggle in the settings.

2. Select a Timeframe:
- Choose the timeframe for analysis (e.g., 1-minute, 1-hour, daily). The indicator fetches volume data specific to the selected timeframe.

3. Interpret the Visualization:
- Compare Bar Lengths:
- Longer buy volume bars (green) indicate stronger buying activity.
- Longer sell volume bars (red) suggest dominant selling pressure.
- Labels:
- Use the labels to view the exact buy and sell volume values for precise analysis.

4. Combine with Other Tools:
- Use the indicator alongside price action analysis, support/resistance levels, or trend indicators to confirm market sentiment and detect potential reversals.

5. Monitor Imbalances:
- Significant disparities between buy and sell volume can signal shifts in market sentiment, such as the end of a trend or the start of a breakout.


Practical Applications

- Trend Confirmation:
- Align the dominance of buy or sell volume with price trends to confirm market direction.

- Reversal Signals:
- Watch for volume imbalances or a sudden shift in the dominance of buy or sell volume to identify potential reversals.

- High-Activity Zones:
- Identify areas with increased volume to anticipate significant price movements or key support/resistance interactions.


Dixson's Weighted Volume Flow provides a clear and systematic way to analyze market activity by visualizing the dynamics of buy and sell volume. It is particularly useful for traders looking to enhance their understanding of volume-based sentiment and its impact on price movements.

7 godzin temu

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