Volume indicator for cryptocurrency trading
Cryptocurrencies have long become a familiar stock exchange asset; they can be found in many trading platforms.
Despite the virtual nature of digital money, they lend themselves well to technical analysis, which allows you to use various technical analysis tools .
One of these tools is a volume indicator, which tracks changes in the volume of opened transactions for a selected asset.
Information about how volumes change allows you to decide how strong an existing trend is or confirm a breakout of a price level.
The script has the appropriate name - “Volumes”; it allows you to find out the volumes of transactions carried out on any of the exchange assets, including cryptocurrencies:
After adding a cryptocurrency-currency pair to the chart, this tool displays information about trading volumes for this cryptocurrency in the form of a histogram.
Each histogram column corresponds to one time frame, that is, if you selected a time period of one hour in the chart settings, then the column will show the amount of transactions for one hour.
Green columns indicate that trading volumes are increasing compared to the previous time period, while red ones indicate a decrease in total volume.
To understand the full picture, it is best to simultaneously open several time periods, for example, M15, M30 and H1 so you will see the current trend of changes in volumes.
Volume indicator settings for cryptocurrencies
The script has a minimum number of available settings:
When using it, you can set the color of the histogram bars and set the levels that are important to you, which will be for your strategy.
Information about volumes in the Volumes indicator is obtained from data provided by the broker. Brokers using MetaTrader 4 provide tick data (price and volume) information from the market.
This data is collected and combined for each bar of the chart, and the result is displayed as a histogram in the Volumes indicator.
It is important to note that volumes in MetaTrader 4 are displayed based on tick data and not actual monetary volumes. But this does not prevent you from effectively using the information received in the technical analysis of the cryptocurrency market.
If you need information about the actual trading volumes for cryptocurrency, where to find such information is described in the article - https://time-forex.com/kriptovaluty/obemy-kripto
How to use the Volumes indicator in practice is described in detail in the article - https://time-forex.com/tehanaliz/obemy-v-birzhevoj-torgovle
If the described indicator does not suit you, then you can use an alternative development - https://time-forex.com/indikators/indik-volumes