When you are looking at a chart, volume is usually the first thing you check after price. But standard volume bars may not give you a full picture. That is why we have added the Relative Volume indicator on FYERS.
What is Relative Volume?
Relative Volume identifies how significant the current volume is by comparing it to its own recent average. Instead of showing you a raw number of shares, it presents a ratio. This tells you instantly if the current participation is "normal" or if something unusual is happening.
How is it different from volume?
Standard volume tells you how much was traded, but it doesn't offer context. For example, 5 lakh shares might be a lot for one stock but very little for another.
Relative Volume fixes this by looking at the stock's own history. If a stock usually trades 1 lakh shares in a 5-minute candle and suddenly trades 3 lakh shares, the relative volume will show a value of 3.0. It filters out the noise and highlights exactly when a stock is seeing a surge in interest relative to its own baseline.
How to read this
When you add the indicator from the Indicators menu, you will see a line plotted at the bottom of your chart.
A value of 1.0: The current volume is exactly in line with the average.
Values above 1.0: This indicates higher than average interest. A spike to 2.0 or 3.0 often signals that institutional players are active.
Values below 1.0: This shows the market is quieter than usual, which often happens during consolidation phases.
Example
Let’s say you are tracking NIFTY on a 5-minute chart. The index has been trading in a tight range of 20 points for an hour.
Suddenly, a candle breaks above the range. You look at the Relative Volume and see it has jumped from 0.8 to 2.5. This tells you that the breakout is backed by 2.5 times the normal trading activity. For a trader, this is a signal of high conviction.
On the other hand, if that same price break happens while the Relative Volume stays flat at 0.9, it suggests the move lacks participation. It helps you stay cautious when the crowd isn't following the price.
Try it out
You can find Relative Volume under the Indicators section on FYERS Web & App. Do check it out and let us how you can use it in the comments below.