Volume Price Trend Pro (VPT)

What Is the Volume Price Trend (VPT)?

The Volume Price Trend (VPT) is a cumulative technical indicator that adjusts volume based on the percentage change in price.

• It helps identify whether volume is supporting price movements.
• Shows when buyers (accumulation) or sellers (distribution) are in control.
• More accurate than OBV because it uses the size of price moves, not just up/down direction.

How VPT Is Calculated

• Start with VPT = 0
• Each bar, update:
  • VPT = Previous VPT + (Percentage Price Change × Volume)
  • Percentage Change = (Current Close – Prior Close) / Prior Close

For example:

• If price goes up 2% on 500K volume → add 10,000 to VPT
• If price drops 1.5% on 600K volume → subtract 9,000 from VPT

Over time, VPT builds a running total of volume-driven price momentum.

Key Features of This Enhanced VPT Indicator

This version goes beyond basic VPT with smart upgrades:

• Plots the raw VPT line in magenta
• Adds a 9-period moving average of VPT (blue dashed line)
• Colors the VPT line green-tinted when above average, red-tinted when below
• Includes a histogram showing the difference between VPT and its average
• Shows a zero line for reference
• Displays real-time labels with values and trend bias
• Lets you toggle histogram and zero line on or off

How to Use the VPT Indicator

Trend Confirmation

• When price and VPT are both rising → uptrend is strong and supported by volume
• When price and VPT are both falling → downtrend is real and active
• If price moves but VPT doesn’t follow → weak move, possibly a trap or fakeout

Divergence Detection

• Bullish divergence: Price makes a lower low, but VPT makes a higher low
  → Selling pressure is fading → potential upward reversal
• Bearish divergence: Price makes a higher high, but VPT makes a lower high
  → Buying is weakening → possible drop ahead

Divergences are among the most reliable early signals in trading.

Crossover Signals

• When VPT crosses above its moving average → short-term momentum turns bullish
• When VPT crosses below its moving average → bearish momentum begins
• Use these as triggers when combined with support/resistance or candlestick patterns

Histogram Interpretation

• The histogram shows: VPT – VPT Average
• Green and growing → bullish momentum accelerating
• Green but shrinking → strength fading, pause or pullback possible
• Red and growing → selling pressure increasing
• Red but shrinking → downtrend may be ending

Think of it like a momentum engine — color and size tell you how strong the move is.

Understanding Large VPT Values (Like -250,343)

You might see VPT at:

-250,343

Don’t worry — this is normal.

• VPT is cumulative — it adds up every single bar
• It doesn’t reset, so values grow larger over time
• A negative number just means more net selling pressure has occurred than buying
• A positive number means buying dominance

Focus on the direction and slope, not the absolute number.

For example:

• If VPT is rising from -250,343 → momentum is improving
• If it keeps falling → downtrend is still strong

It’s like tracking total net money flow — the number gets big, but the trend matters most.

Settings You Can Adjust

• avgLength: Default is 9 — this smooths VPT into a short-term average
  → Try 21 for slower, longer-term signals
• showHistogram: Set to “yes” or “no” — hide it for a cleaner chart
• showZeroLine: Toggle the gray zero line on or off

Use these inputs to customize the look and sensitivity based on your trading style.

Best Practices for Using VPT

• Always use VPT with price action — never in isolation
• Check higher timeframes first to know the overall trend
• Look for divergences at key support or resistance levels
• Watch for volume spikes — they often lead to big moves
• Combine with RSI, MACD, or moving averages for stronger confirmation
• Works well for stocks, ETFs, futures, and crypto

Ideal for:

• Swing traders
• Momentum traders
• Reversal hunters
• Confirmation tool in any strategy