VSI Indicator
The VSI Indicator for MT4 detects bullish/bearish spikes in volume.
Description
The VSI Indicator for MetaTrader 4 is a forex indicator that detects bullish and bearish spikes caused by a sudden rise in the trade volume of an asset. It is simply a volume-based indicator that detects volatility spikes in the market.
The indicator is an incredible forex trading tool for catching the big moves caused by the market makers. This is because spikes in the volume of financial instruments often suggest that the market may likely continue in that direction for a while.
Furthermore, in some cases, sudden spikes in the volume of an asset may lead to a minor retracement, thereby creating trading opportunities for scalpers to catch the small moves. Therefore, the VSI indicator for MT4 would be a very handy tool for both scalpers and day/intraday traders to take advantage of the spikes in the market volume.
How to Trade with the VSI Indicator for MT4
The above image depicts the action of the VSI indicator on the EURUSD pair. The indicator uses the blue line to display a sharp increase in the volatility of the price.
Thus, a bullish/bearish spike in volatility is displayed when the blue line makes a straight move to the upside and then retraces with a sharp edge downward. Furthermore, bullish spikes are sharp volatility rises on the bullish candlesticks, while bearish spikes occur on bearish candlesticks.
Therefore, you may look for an opportunity to buy or sell an asset once the indicator displays a spike in volatility. For instance, the above image shows that the indicator detected a bearish spike in volume, while the bearish candlestick pattern signals the sell entry.
Conclusion
The VSI Indicator for MT4 is a volatility detector that displays the sudden rise in the volatility of instruments in the forex industry.