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Technical Analysis, Studies, Indicators:

Volume ROC (Rate of Change)

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The Volume Rate of Change (Volume ROC) is identical to the ROC (Rate of Change) technical indicator that displays the percentage difference between the current Volume and the volume n-time periods ago. The formula for calculating Volume ROC is

Volume ROC = (Volume - Volume N periods ago) / Volume N periods ago * 100

Like the ROC, the Volume ROC is an oscillator that fluctuates above and below the zero line. When the volume increases, the Volume ROC moves up and when the price decreases, the Volume ROC falls. The greater the change in volume, the greater is the change in the Volume ROC.

A high volume ROC may indicate volume surges and can be used to define the overbought/oversold moments that can lead to a trend reversal.

It is good practice to scroll backwards on the chart to the recent past (several frames back) to look for connections between Volume ROC, volume surges and the price reversal and try to apply them to the current market.

It is a good idea to use this indicator in conjunction with other price-based technical indicators.

Chart 1: Volume ROC (Rate of Change)

Nasdaq 100 chart - Volume ROC

V. K.

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Technical studies classified by the types of technical analysis
MV Studies - list of technical indicators (studies) developed MarketVolume® team. We are the first who introduced this indicators to the world and at the current moment we are the only company that provides these indicators and we consider ourselves these indicator developers.

Price Studies - information about calculation and using RSI, Stochastics, MACD, and other price based technical indicators (studies) which are available with our charts.

Volume Studies - a list of volume based technical indicators (studies) which are available with our charts.

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Volatility Studies - a list of technical indicators (studies) which are used to measure market and security volatility and are available with our charts.

 

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© 1997-2010 Highlight Investments Group. All Rights Reserved.
7/31/2010 - SV1