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Positive Negative Volume Index

The Positive/Negative Volume Index (VolumeIndex) attempts to identify bull markets. The Positive Volume Index (PVI) shows what the uninformed investors are doing, while the Negative Volume Index (NVI) shows what the smart investors are doing.  It is based on the assumption smart investors dominate trading on light volume days and uninformed investors dominates trading on active days.  The PVI changes on days when the volume is up and stays flat on down volume days.

Market Signals

If NVI line above PVI it means a new trend is emerging. If, after that, PVI line crosses NVI line and stays above it, a long position can be opened.

Calculation

Positive

Positive Negative Volume Index 001

Positive Negative Volume Index 002

Negative

Positive Negative Volume Index 003

Positive Negative Volume Index 004

Chart Example

Positive Negative Volume Index 005

Implementation and Usage

Indicator has no input parameters. To initialize VolumeIndex use one of the following constructors:

VolumeIndex

Use

PVI

NVI

properties to get current value

Example
C#
Copy
 1// Create new instance
 2VolumeIndex volIndex = new VolumeIndex();
 3
 4// Number of stored values
 5volIndex.HistoryCapacity = 2;
 6
 7// Add new data point
 8volIndex.Add(Bars.Current.Open, Bars.Current.High, Bars.Current.Low, Bars.Current.Close, Bars.Current.Volume);
 9
10// Get indicator value
11double IndPotitiveIndex = volIndex.PVI;
12double IndNegativeIndex = volIndex.NVI;
13// Get previous values
14if (volIndex.HistoryCount == 2)
15{
16    double IndPrevPotitiveIndex = volIndex[1].PVI;
17    double IndPrevNegativeIndex = volIndex[1].NVI;
18}