Rajandran R Telecom Engineer turned Full-time Derivative Trader. Mostly Trading Nifty, Banknifty, USDINR and High Liquid Stock Derivatives. Trading the Markets Since 2006 onwards. Using Market Profile and Orderflow for more than a decade. Designed and published 100+ open source trading systems on various trading tools. Strongly believe that market understanding and robust trading frameworks are the key to the trading success. Writing about Markets, Trading System Design, Market Sentiment, Trading Softwares & Trading Nuances since 2007 onwards. Author of Marketcalls.in and Co-Creator of Algomojo (Algorithmic Trading Platform for DIY Traders)

Code Snippet – Normalized Volume

27 sec read

Studying the Volume behaviour in a stock and index futures plays a critical role in studying the supply and demand behavior. What if we want to rate the volume with relative to last 50-bars. In such a scenario Normalized Volume Comes into picture. Normalized volume is a volume divided by its average.

Formula

Normalized Volume = Volume / MovingAverage(Volume, 50) * 100

When,

Normalized Volume > 150 is High Volume (Green Historgram bar)
Normalized Volume < 75 and > 150 is normal Volume (Yellow Historgram bar)
Normalized Volume < 75 is low volume (Red Historigram bar) Nifty Future Normalized Volume
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Generally when the normalized volume is high it introduces lots of volatility in the market. And typically a low volume shows a low volatile behavior in the market.

Amibroker AFL Code
https://gist.github.com/0047f7a5fb7933187bd3

Rajandran R Telecom Engineer turned Full-time Derivative Trader. Mostly Trading Nifty, Banknifty, USDINR and High Liquid Stock Derivatives. Trading the Markets Since 2006 onwards. Using Market Profile and Orderflow for more than a decade. Designed and published 100+ open source trading systems on various trading tools. Strongly believe that market understanding and robust trading frameworks are the key to the trading success. Writing about Markets, Trading System Design, Market Sentiment, Trading Softwares & Trading Nuances since 2007 onwards. Author of Marketcalls.in and Co-Creator of Algomojo (Algorithmic Trading Platform for DIY Traders)

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4 Replies to “Code Snippet – Normalized Volume”

  1. Small mistake in the text

    Normalized Volume 150 is normal Volume (Yellow Historgram bar)

    It should be Normalized Volume > 80 and < 150 is normal Volume (Yellow Historgram bar)

  2. sir i want afl code for current volume bar greater than previous 15 bars – strong volume
    current volume bar greater than previous 20 bars – stonger volume
    current volume bar greater than previous 40 bars- strongest volume.. i want this code for scanning purpose and alert output…. your help will be highly appreciated… and any change in this logic, if you find that better pls also provide it.

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