Percentage Volume Oscillator Indicator

Percentage Volume Oscillator Indicator

Percentage Volume Oscillator indicator for MT4 provides BUY and SELL forex trading signals using volumes.

The Percentage Volume Oscillator indicator for MT4 resembles a classic MACD indicator with moving averages and a histogram. However, the primary data for the indicator calculation is the volume. The indicator is best suitable for forex technical traders using volume as an integral component in their technical trading strategies. The Bullish and Bearish trading signals are confirmed with both the moving averages and the histogram bars of the indicator.

The indicator is best suitable for new and advanced traders. New forex traders can combine the volume-based trading signals with other technical indicators for confirmation. However, advanced forex traders should consider that volume is an essential component in breakouts and reversals. So, combining trend-based technical indicators and using the Percentage Volume Oscillator indicator for MT4 will provide the best results.

Percentage Volume Oscillator Indicator For MT4 Trading Signals

The above AUDUSD M30 price chart shows the Percentage Volume Oscillator indicator for MT4 in action. The indicator shows the Zero line of the histogram in GRAY while showing the Bullish histogram bars as GREEN and Bearish histogram bars as RED. The moving averages are in MAGENTA and BLUE.

The indicator signals are based on the moving average crossover. However, the positive and negative histogram bars can filter these signals. So, forex traders should combine both the moving averages and the histogram bars to confirm a trading signal generated by the indicator.

If the BLUE moving average crosses above the MAGENTA moving average it indicates a Bullish trading signal. However, to confirm this as a Bullish signal the histogram bars should be GREEN and must be above the Zero line. If all the abovesaid signals are in confluence then the trader can enter the market with a BUY position. The best stop loss point is below the recent swing low and the opposite signal could be the best point to book the profits.

Similarly, the downward crossover of the BLUE moving average to the MAGENTA moving average signals a BEARISH market trend. However, for confirmation of this signal, the histogram bars should be RED and below the Zero line. The best stop loss point is below the recent swing low while a target to take profits at opposite trading signals looks prudent. However, it’s a good practice to book profits with a good risk to reward ratio.

Technical forex traders should note that volume is not the only component for a price reversal and volume cannot be used alone to identify the trend. However, it’s an undeniable truth that rising and falling volumes are often associated with Bullish or Bearish trend reversals.

Conclusion
The Percentage Volume Oscillator indicator for MT4 if combined with other trend-following indicators will provide the best results. However, forex traders should be able to understand the importance of volume and associate it with breakouts and reversal. Substantial Volume plays an important part when the price is near support, resistance, channel, or Triangle. Additionally, the indicator is free to download and install.