Normalized Volume Indicator
The Normalized Volume Indicator provides insights into trading activity relative to historical averages, helping traders identify potential trends and reversals. To effectively use this indicator, monitor for spikes in normalized volume, which can signal increased interest in an asset, potentially preceding price movements. Combine the indicator with other tools, such as moving averages or momentum indicators, to confirm signals and avoid false breakouts. Additionally, watch for divergences where price moves contrary to volume trends, as these can hint at upcoming reversals. Always manage risk with appropriate stop-loss orders to protect against unexpected market changes.