Page 120 - A Complete Guide to Volume Price Analysis: Read the book then read the market

Fig 12.11 Candlevolume Chart

A little more recognizable! On these charts the candles are now all different widths to reflect the volume on each candle, with the price action
represented vertically as usual, but with the open, high low and close displayed. On this chart we see our traditional wicks to the top and bottom of
each candle. This is not an approach I have studied personally in any great detail, but it may have some advantages, and at least overcomes what I
consider to be one of the big drawbacks with equivolume, namely the lack of time, which I believe is fundamental to any VPA approach. However, I
always keep an open mind, and if any readers of this book have used candlevolume and have found this system helpful, please do drop me a line
and send me your thoughts and comments. You can never stop learning in trading!

Delta Volume

Finally just to round of this chapter on the ‘future’ for Volume Price Analysis, there are two further approaches to analyzing volume which are gaining
some traction, and these are delta volume and cumulative delta volume.

In simple terms delta volume refers to the difference in volumes between those contracts that trade at the ‘ask’ and those that trade at the ‘bid’. In
other words, orders that are sell orders and those that are buy orders, with the net difference between the two then displayed as ‘delta’. For
example, if the software calculates on one bar, that there have been 500 contracts sold at the bid and only 200 contracts bought at the ask, then this
would represent a net difference of 300 contracts sold. Any indicator measuring delta volume would then display this as a negative volume bar of -
300 and generally these appear as shown in the schematic below in Fig 12.12