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Volume Based > Volume Oscillator

Article/Author: Omega Research Inc., 1997

Download: VOLUME-OSC.ELA

Category: Indicator > Volume Based

Description:

The Volume Oscillator indicator calculates a fast and slow volume moving average. The difference between the two (fast volume ma – slow volume ma) is then plotted as a histogram. The histogram, like an oscillator, fluctuates above and below a zero line. Volume can provide insight into the strength or weakness of a price trend. This indicator plots positive values above the zero line, and negative below.

Usage:

A positive value suggests there is enough market support to continue to drive price activity in the direction of the current trend. A negative value suggests there is a lack of support and prices may begin to become stagnant or reverse.




Inputs:

Vol - Value used in calculating the Volume Oscillator
Fast - Number of bars used to calculate the fast volume moving average
Slow - Number of bars used to calculate the slow volume moving average

EasyLanguage Code:

INPUTS: VOL(VOLUME), FAST(14), SLOW(34);
VARIABLES: VOLUMEOSC(0);

VOLUMEOSC = AVERAGE(VOL, FAST) - AVERAGE(VOL, SLOW);

PLOT1(VOLUMEOSC, "VOLOSC");

IF PLOT1 CROSSES OVER 0 THEN
ALERT("VOLUME OSCILLATOR CROSSED OVER ZERO")
ELSE
IF PLOT1 CROSSES UNDER 0 THEN
ALERT("VOLUME OSCILLATOR CROSSED UNDER ZERO");