Volume Price Trend Divergence Indicator

Volume Price Trend  Divergence Indicator Generation III is modern indicator with complex mathematic algorithm (BJF Trading Group innovation). You will see divergenses on the chart and indicator. Arrows painted above/below the open bar and not in the past. You can see when actually you can trade. It is never to late! Signals based on closed bars so the arrows above/below open bar never disappear.

MT4 Indicator Volume Price Trend Divergence

MT4 Indicator Volume Price Trend  (VPT) Divergence indicates fractal divergence by VPT indicator.When divergence appears between Volume Price Trend  and the price, it indicates a high probability that the current trend will finish soon. A signal to buy is when a new Low-fractal is formed below the previous one and a corresponding VPT value is higher than the previous one. A signal to sell is when a new Up-fractal is formed above the previous one and a corresponding Volume Price Trend value is lower than the previous value. The indicator VPT has a lot of customizable settings.

Volume Price Trend Indicator Explanation

Volume Price Trend (VPT) (sometimes Price Volume Trend) is a technical analysis indicator intended to relate price and volume in the stock market. VPT is based on a running cumulative volume that adds or subtracts a multiple of the percentage change in share price trend and current volume, depending upon their upward or downward movements

The starting point for the VPT total, i.e. the zero point, is arbitrary. Only the shape of the resulting indicator is used, not the actual level of the total. VPT is similar to On-balance Volume (OBV), but where OBV takes volume just according to whether the close was higher or lower, VPT includes how much higher or lower it was.

VPT is interpreted in similar ways to OBV. Generally, the idea is that volume is higher on days with a price move in the dominant direction, for example in a strong uptrend more volume on up days than down days. So, when prices are going up, VPT should be going up too, and when prices make a new rally high, VPT should too. If VPT fails to go past its previous rally high then this is a negative divergence, suggesting a weak move.