Volume Price Trend

The Volume Price Trend (VPT) indicator combines price movement with volume to give a cumulative measure of the trend. It is similar to the On-Balance Volume (OBV) indicator but adds a weighting of the price change relative to the volume. This helps identify the strength of a trend by considering both price and volume together.

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Manufacturer: nt8indicators

SKU: VPT

Vendor: nt8Indicators

$9.90

Qty:

How it works:

When the price closes higher, the VPT is added to the previous VPT value based on the current volume.
When the price closes lower, the VPT is subtracted from the previous VPT value based on the current volume.
It gives more weight to price changes on higher volume, which can signal a more significant trend.

Formula:

$V PT = V P T_{p re v} + (P re v i o u s Cl ose ( Cl ose - P re v i o u s Cl ose )) \times V o l u m e$

Where:

( VPT_{prev} ) is the previous value of the Volume Price Trend.
( Close ) is the current close price.
( Previous Close ) is the previous close price.
( Volume ) is the trading volume for the current bar.

Usage:

Rising VPT: Indicates a strong upward trend with increasing volume.
Falling VPT: Indicates a strong downward trend with increasing volume.

A signal Line may help determining the trend.

Product tags

volume (8)
,
signal (5)
,
trend (9)
,
two lines cross (5)

Risk Disclosure: Futures and forex trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones’ financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.

Hypothetical Performance Disclosure: Hypothetical performance results have many inherent limitations, some of which are described below. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown; in fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk of actual trading. for example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all which can adversely affect trading results.

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