📘 What This Indicator Does

• It shows tick volume (number of price changes per bar) as a histogram.
• In Forex, brokers rarely provide real traded volume, so tick volume is used as a proxy.
• In stocks/CFDs/futures, you might get real volume.
• It overlays a Moving Average of volume (default 20-period).
• This acts as a “baseline” to quickly spot whether the current bar’s volume is unusually high or low.

🎯 How to Use as Confirmation

The indicator is not a standalone signal generator. Instead, traders use it to confirm setups from other strategies:

1. Breakout Confirmation
2. • If price breaks above resistance or below support, check if the breakout candle has volume above its MA.
   • High volume confirms more participants are behind the move → breakout is more reliable.
   • Low volume breakout = higher chance of false breakout.
2. Trend Continuation vs. Exhaustion
3. • In a strong trend, pullback candles often have lower volume compared to impulse candles.
   • If a pullback happens on low volume and the next move resumes with higher volume → confirms trend continuation.
   • If you see the trend push continuing but volume dropping each push → possible exhaustion, prepare for reversal.
3. Reversal Confirmation
4. • Big reversal candles (pin bars, engulfing candles, fractals) are stronger if backed by a volume spike.
   • Example: bullish pin bar at support with high volume = stronger reversal signal than same pin bar on low volume.
4. False Signal Filter
5. • If your main system gives a buy/sell, but volume is weak (below average), you might choose to pass on that trade.
   • Helps reduce overtrading and filter noise.

📊 Effectiveness

• In Forex: Tick volume has been shown to correlate strongly with real traded volume (70–90% correlation in many studies). So it’s useful, but not perfect.
• In Stocks/Futures/CFDs: Real volume makes this much more powerful since you’re measuring actual traded contracts/shares.
• As Confirmation: It’s best used with price action and other indicators (e.g., EMA, RSI, fractals). Relying on volume alone is risky.
• Strengths: Confirms breakouts, filters false moves, spots exhaustion.
• Weaknesses: Does not predict direction by itself — only adds confidence once you have a setup.

✅ Practical tip:
Use the indicator as a filter, not a trigger. For example:

• You see an EMA crossover (buy signal).
• Check: Is volume above its moving average? If yes → take trade. If not → wait.

This way you only trade when momentum is backed by market participation.