Volume Quality: when is high volume a good sign?

What is Volume Quality?

Volume tells you how many contracts or shares changed hands, but not which side won. Volume Quality (VQ) reads volume together with the candle, on a 0–100 scale, separately for buying and selling. It combines four parts:

A component without data is dropped and the rest are reweighted.

Why is high volume not always good?

• Effort needs a result. High volume with a long body in the trade direction is a real push. High volume while price barely moves suggests the other side is absorbing the orders.
• Volume changes by time of day. Volume at the New York open is always higher than at Asian midday. RVOL should compare with the same time on previous days; otherwise every session-open candle looks like a spike.
• One candle is not enough. Volume expanding over several candles is more reliable than one isolated bar.

Common misunderstandings

• High volume is a buy signal. High volume at the end of a long rally may be sellers taking profit.
• Forex tick volume is real money flow. Tick volume counts price changes, not exchange trading volume. It is only useful in relative terms (RVOL).
• Delta on TradingView is native order flow. Delta on candlestick charts is usually estimated from lower-timeframe bars, not native bid / ask exchange data.
• CFD volume is exchange volume. Gold or NAS100 CFDs have no native exchange volume; using the matching futures contract’s volume is only a reference volume.

Chart example

Illustration, not real market data. The gold volume bars are the two candles with RVOL above 2.

The first candle: RVOL 2.4, a long body closing near the high, so VQ is high. The second: RVOL 2.2 but a very small body, so it is flagged as absorption even though its volume is almost the same.

How does AURORA use Volume Quality?

• Time-of-day RVOL: compared with volume at the same time over the last 10 days (at least 3 samples). Without enough data, or on daily and higher charts, it falls back to the median of the previous 20 candles.

• RVOL thresholds: 1.3 and above is strong, below 0.7 is weak. On the live candle, the dashboard shows RVOL~, a projection based on elapsed time.

• Absorption flag: RVOL at or above the strong level but a candle smaller than 0.6 ATR or a very weak body. The tooltip shows ⚠ absorption.

• The volume filter is off by default. Three choices:

  • Off.
  • RVOL ≥ Strong.
  • Volume Quality ≥ min (45 by default, with no absorption flag).

  In AURORA Pro, BREAK, SUNNY and SMC each have their own filter box.

• No data blocks everything. If the filter is on in a market without usable volume, every setup is blocked for safety. Switch it on only when you are sure the data exists.

• Volume source by Market Preset:

• AURORA Standard V12.2: to use external volume for CFDs, you must enter the futures symbol and tick the confirmation box. The dashboard shows EXT !CONFIRM, EXT ✓ or EXT NO DATA.
• AURORA Pro: picks the contract from the chart symbol automatically, for example XAU → COMEX:GC1!, NAS100 → CME_MINI:NQ1!.

Limits of Volume Quality

• Reference volume does not match the CFD exactly. Futures trading hours and roll dates do not line up perfectly with the CFD.
• Delta is an estimate. It depends on how much lower-timeframe data your TradingView plan allows.
• Quiet hours. Low volume makes RVOL jumpy; a single large order can push it high.
• Filters easily become too strict. The ⛔ Filtered dashboard row tracks blocked setups. If it is positive, the filter may be blocking good trades; also look at average R, drawdown and trade count before concluding. Historical results, before costs.