Volume Demand & Supply Indicator

Title: VDS - Volume Demand & Supply Indicator

Description:

The VDS (Volume Demand & Supply) Indicator is a powerful analysis tool designed for traders who rely on understanding volume to make informed decisions. Unlike traditional volume indicators, VDS goes beyond just showing total volume by separating it into Up Volume and Down Volume, giving you a clear view of the buying and selling pressure in the market.

Key Features:

Precise Volume Analysis: The indicator scans data from lower timeframes to more accurately approximate up and down volume, providing you with detailed insights into market dynamics.

Identify Buying vs. Selling Pressure:

Up Volume: Represents the volume traded when the price rises, indicating dominant buying power.

Down Volume: Represents the volume traded when the price falls, indicating significant selling pressure.

Volume Moving Average (MA): A volume moving average is included to help you easily identify normal versus abnormal market activity, which is crucial for spotting strong trends and breakouts.

Delta Signal: The small "Delta" character indicates the difference between up volume and down volume. A green delta suggests buying dominance (demand), while a red delta points to selling dominance (supply).

Customizable: You have the ability to customize the lower timeframe used for analysis, allowing you to tailor the indicator to your specific trading strategy and style.

How to Trade with the VDS Indicator?

The VDS indicator isn't just a data visualization tool; it's a practical guide that can be used to confirm or deny trading signals. Here are a few suggested strategies:

Confirming Breakouts:

When the price breaks above a key resistance level, look for a significant increase in Up Volume. This confirms the breakout is genuine and supported by strong buying power.

A breakout with weak volume might be a "fakeout" and should be treated with caution.

Validating Trends:

In an Uptrend: You should consistently see the Up Volume (green columns) higher than the Down Volume (red columns). This shows that buyers are in control.

In a Downtrend: You should consistently see the Down Volume higher than the Up Volume, indicating sellers are dominant.

Detecting Trend Weakness (Divergence):

If the price is making new highs but the Up Volume is decreasing, it could signal a weakening of buying pressure, potentially leading to a trend reversal.

The opposite is true in a downtrend: if the price is making new lows but the Down Volume is weakening, a reversal may be imminent.

Using the Delta Signal for Reversals:

When the Delta signal turns from red to green at a price low (near a support level), it can confirm the beginning of new buying strength.

When the Delta turns from green to red at a price high (near a resistance level), it can confirm the start of new selling pressure.

The VDS indicator is a valuable addition to any trading strategy, adding a new dimension to volume analysis and helping traders understand what's really happening behind price movements.