PVT MT4 Indicator – Price Volume Trend Indicator 

 July 16, 2016

By  Advanced Strategies

PVT MT4 indicator is also known as the Price Volume Trend Indicator. It belongs to the class of momentum based oscillators and is displayed on the sub-window of the chart. The PVT looks similar to most other momentum based indicators such as the RSI or the On Balance Volume indicator. In comparison, the Price Volume Trend indicator works almost very similar to the on balance volume indicator. The main difference being that the PVT adds or subtracts a portion of the daily volume depending on if it was an up day (bullish) or a down day (bearish). Depending on how strongly prices rise or fall, the PVT adds or subtracts the volume accordingly.

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The PVT is ideally used to measure momentum and can be explained by the fact that when price adjusted volume on up days outperforms the price adjusted volume on down days, the PVT rises. The PVT indicator, due to the fact that it combines volume and price can be a good indicator to judge trends and potential reversals. The first chart below shows the PVT (top) and the OBV (bottom) as a comparison. While the On Balance Volume indicator is a bit sharper, the Price volume trend is a bit smoother. That said, the indicators look almost identical in nature.

PVT MT4 Indicator vs OBV MT4 Indicator
PVT MT4 Indicator vs OBV MT4 Indicator

Trading with PVT MT4 Indicator

The Price volume trend can be used in trading just as with any other oscillator. However, because there are no overbought or oversold levels, the PVT is at best used as a trend following tool or as a divergence indicator. There are no indicator settings or look back periods. The only change that one can make is to change the price that is being calculated. The default is 0 which is the closing prices. No changes are necessary.

While it is easy to explain and identify the slopes in hindsight, in real time it can be difficult to ascertain price trends looking at the PVT alone. Also, another big drawback with indicators such as the PVT or the OBV is the fact that volume is not aptly reflected in the forex markets where there is no centralized exchange. Therefore, the so called volume that is available on the MT4 platform is merely part of the larger transactions. Traders should therefore keep this in mind when trading the price volume trend indicator.

Using the PVT MT4 Indicator to identify Support and Resistance levels

The Price volume trend indicator however serves as a good indicator to identify support and resistance levels. To do this, simply compare the turning points in price on the chart and plot a horizontal line.

Using the PVT MT4 Indicator to identify Support and Resistance levels
Using the PVT MT4 Indicator to identify Support and Resistance levels

The above chart shows how horizontal support and resistance levels can be identified by comparing the bounce in both the PVT and price. Plotting a horizontal line following the bounce then shows the PVT first breaking the horizontal support or resistance levels, which is then followed by a breakout in price.

On the left side of the chart, we first spot a support level which is then broken by the PVT and then followed up by price breaking the support level. Similarly on the right side of the chart, the horizontal resistance level is plotted on the bounce in prices which is then followed by a breakout in the PVT and subsequently the price breakout.

In conclusion, the price volume trend indicator doesn’t quite offer much in terms of being useful as an indicator. Divergences are hard to come by and the fact that there are no overbought or oversold levels makes it even more difficult.

PVT MT4 Indicator – Recommended Time Frames

Technically speaking, you can use this MT4 indicator for all time frames. However, the shorter the time frame, you will see more fluctuation and possibly more whipsaw which may cause small losses that can eat up your portfolio quickly. We recommend that you use higher time frames like the 4H for better consistency.

How to Trade with Price Volume Trends – Video Tutorial

How to trade with Price Volume Trends Video Tutorial

PVT MT4 Indicator Download

We have provided this powerful trend trading indicator to you at no cost. We humbly request for your help to spread the word by sharing on one of the social platforms below. To unlock the download link, you just need to share this page to help us achieve our goal of helping more traders out there.

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Leave us a comment below to let us know your thoughts on this indicator. If you like this indicator, you might like see other indicators that we have carefully selected that will help you in your trading journey.

And if you can, you really should invest in a proven MT4 Expert Advisor to help you generate some profit on full autopilot. We highly recommend this powerful MT4 Expert Advisor.

Visit our Free MT4 Indicator Download page. We hope you have enjoyed this post as much as we have creating it. Good luck and thank you for your readership.

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