Bullish Volume Ratio

Bullish Volume Ratio (BVR) Indicator

The Bullish Volume Ratio (BVR) is a sophisticated momentum oscillator designed to measure the true intensity of buying pressure versus selling pressure in the market. It provides a unique, statistically-driven view of market conviction, making it an essential tool for traders who seek to confirm trend health and anticipate major shifts.

BVR achieves its precision by not only assessing net volume but also using proprietary volume weighting logic to gauge the quality of participation in each candle, filtering out market noise to present a clear picture of underlying demand.
Key Features

Statistically-Driven Conviction: The indicator utilizes a Z-Score to measure how far the current BVR reading deviates from its historical average, providing an objective measure of whether buying or selling is truly exceptional or just noise.

Clear Visual Signals: The oscillator plot is designed for clear interpretation on a separate pane, helping you identify regime shifts without cluttering the main price chart.

Real-Time Data Dashboard (Optional): A customizable table on the chart displays the current BVR, Z-score, and other critical volume metrics at a glance.

Simplified Trading Guide

The BVR indicator simplifies volume analysis into clear, actionable signals that can be used for trend confirmation and reversal anticipation.
1. Trend Confirmation

Use the BVR to confirm the momentum of an existing trend:

Bullish Confirmation: When price is trending up, look for the BVR line to be rising and consistently above the center line. This signals that buyers are in firm control and the uptrend has strong volume conviction.

Bearish Confirmation: When price is trending down, look for the BVR line to be falling and deep below the center line. This indicates sellers are dominating the volume profile, confirming the strength of the downtrend.

2. Identifying Trade Entry/Exit Zones

The indicator's Z-Score component is key to spotting extremes that often precede a reversal:

Potential Long Entry: Look for a sustained negative Z-Score followed by a sharp crossover back towards the center line or into positive territory. This can signal that selling pressure has reached an exhaustion point and accumulation (buying) is beginning.

Potential Short Entry: Look for a sustained positive Z-Score followed by a sharp crossover back towards the center line or into negative territory. This suggests that buying momentum is exhausted and distribution (selling) is commencing.

3. The Volume Spike Filter

The indicator also alerts you to candles with significantly high volume relative to the recent average. Use this as a filter:

Breakout Validation: A price breakout is more likely to be legitimate if it is accompanied by a high volume spike confirmed by a strong BVR reading in the direction of the breakout.

Reversal Warning: A high volume spike at a key support or resistance level, particularly one that leads to a sharp turn in the BVR, can strongly signal a climactic reversal in progress.