Relative Volume is one of the most important indicators and Traders should check it while trading/analyzing. it is used to identify whether the volume flows are increasing or decreasing. Relative volume measures current volume in relation to the “usual” volume for this time of the day. What is considered “usual"? For that, we have to use a historical baseline known as the average daily volume. That means how much volume a security does on a daily basis over a defined period. (This scripts runs on the time frames greater or equal 1 minute and less than 1 day)
The common definition for real-time relative volume is: Current volume for this time of day / Average volume for this time of day. It does not mean taking the volume (for example) from 10:30 am to 10:45 am and comparing it to what it does from 10:30 am to 10:45 am every day. What it truly means is to compare cumulative volumes. Therefore, this is the precise definition of real-time relative volume:
Current cumulative volume up to this time of day / Average cumulative volume up to this time of day
What should we understand while checking RVOL; - Relative volume tell us if volume flows are increasing or decreasing - A high relative volume tells us that there is increased trading activity in a security today - Increased volume flows often accompany higher volatility i.e. a significant price move
Let see an example:
P.S. if you want to get more info about RVOL/Relative Volume then you can search it on the net. While developing the scriptthiswas used as reference, you can also check it for more info.
Enjoy!
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Algorithm slightly improved. instead of calculating cumulative volume on each bar, now the array keeps cumulative volumes. Lighter colors used.
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Tooltip added for the input "Number of Days". unnecessary input option removed.
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Fixed for Daylight saving: "Daylight saving on last weekend" option added. Please enter +1/-1 if Daylight saving last weekend, if not please keep it 0.
Is it possible to set alerts on your indicator directly or as part of