Volume Indicators

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Averaged Volume & Summed Volume are ways in which you can see the volume data. On our charts Averaged Volume is set by default and only applies to periods of 5 days or more. In technical analysis Averaged Volume is always based on one-minute volume ticks, and means that when you are viewing a 5-day chart (5-minute bars or ticks) each volume bar is the AVERAGE volume of FIVE one-minute ticks, or on a 15-day chart (15-minute ticks), each volume bar represents the average of 15-minutes of volume. Summed Volume uses the same principles as, Averaged Volume, but here we just add the 1-minutee volume ticks together and do not average them out.

Below you can see charts of the NASDAQ 100 during the period of January 11, 2002 to January 14, 2002. The left one uses, Summed Volume, the right one with Averaged Volume.

Chart #1: NASDAQ 100, 01/11/2002 - 01/14/2002, VMA 30 min Summed Volume

Chart #1: NASDAQ 100, 01/11/2002 - 01/14/2002, VMA 30 min Averaged Volume

Those two charts look the same except for one difference: the vertical volume scale. In the case of Summed Volume we have 1,027,900, and for the same point Average Volume is 205,500.

It really doesn't matter which chart you use, but we created averaged volume simply to make it easier to correlate 5-day to 60-day charts with 1-day intraday charts. This way you can select a level of Volume MA that you think will cause a reversal in the market, and the level will be consistent over all of the chart views.

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