Volume Behavior

Volume is an important part of understanding the behaviour of instruments. This Indicators colours the candles/bars according to whether the volume for that time period of the candle is an Accumulation or Distribution candle or in fact if it has less volume that the previous candle. This simple tool can help traders of any instrument that involves volume to instantly visualise this volume behaviour to help confirm trade directions and more importantly to identify when a move is running out of juice and will aid in making trade management decisions.

What do you get

Volume Behavior for ThinkorSwim

Use a trading volume indicator to confirm trends, move continuation, or reversal. The Volume Behavior for ThinkorSwim offers such technical analysis. It displays volume changes when the market has more buyers or sellers.

Hence, it helps you decide when to enter the market or take your profits based on trading volume. As such, it’s a crucial tool to add to your collection of indicators for better market insights.

Volume Behavior for ThinkorSwim Features

This volume indicator helps you confirm price direction. It shows you when a trend is gaining momentum and when there’s less interest and a possible reversal ahead.

Consequently, when you get this indicator, you see the following features on your chart:

1. Green Candle
2. Grey Candle
3. Red Candle
4. Cyan Candle

A Green Candle signifies a volume UP trend. Thus, there’s more trading volume than the previous candle. This is an accumulation candle, and when it appears after a low-volume candle, it shows the trend is picking up speed with more traders buying the instrument.

It’s a buy signal, and when another Green candle appears, it shows the trend is gaining momentum. However, if it turns gray while you’re in a long trade, tighten your stop-loss as the upside is running out.

When you see a Grey Candle on your chart, it’s also an UP move, but the volume is lower than in the previous candle.

Thirdly, your chart displays a Red Candle when there’s a DOWN trend with an increase in volume than the previous candle. It’s a distribution candle, meaning there’s more selling volume.

When it appears after a low-volume candle, the momentum is trending down. However, when the candle after the Red one is Cyan, tighten the stop loss orders for short trades.

Lastly, a Cyan Candle signals a DOWN trend with a lower volume than the previous candle.

Volume Behavior for ThinkorSwim in Action

This indicator identifies various changes in trading volume and highlights these developments in the candles and bars. Hence, changes in the colors of candles and bars show you when the market had a distribution, accumulation, or low volume.

It simplifies technical analysis of trading volume, ensuring that even a beginner can see the change without tedious calculations. The visual display of volume changes helps forecast and make better trade decisions. Further, it gives you historical data for reference if you want to analyze the past volume levels for an instrument.

It does this on the existing chart. Therefore, getting this indicator will not clutter your chart or add another analysis chart.