The Volume Oscillator(VO) uses the difference between two moving averages of volume to determine if the overall volume trend is increasing or decreasing.
When the Volume Oscillator rises above zero the shorter-term volume moving average has risen above the longer-term volume moving average. This means that the short-term volume trend is higher than the longer-term volume trend. Bullish signals stem from rising prices coupled with increased volume, and falling prices coupled with decreased volume. Alternatively, if volume increases as prices fall, or volume decreases as prices rise, the market is thought to be showing signs of underlying weakness.
The logic behind this strategy is that rising prices coupled with increased volume signifies more buyers which should lead to a continued move. Similiarly, falling prices coupled with increased volume should mean fewer buyers.
Calculation:
Type = Percent/Point
EMA = Exponential MovingAverage
Inputs:
Short Period = 1
Indicates short time period(the number of days for daily analysis, the number of weeks for weekly analysis, etc.).
Long Period = 25
Indicates long time period(the number of days for daily analysis, the number of weeks for weekly analysis, etc.).
Moving Average Type = Exponential
Indicates the moving average type.
Type = Point
Indicates Percent/Point selection.
Indicator Type: Market Strength