Best Forex Indicator for Volume Analysis

There is no reliable volume indicator in spot forex which can be used for volume analysis.

In forex futures trading, this is an easy matter because the exchange provides a record of daily volumes, but in forex spot markets, there is no centralised trading venue for market participants.

MT4 Volume Indicator

Liquidity is provided by big institutions ( banks, Hedge Funds, etc), such as JP Morgan, Credit Suisse, Barclays, Citi, etc in different financial centres ( London, Frankfurt, New York, Tokyo, etc). They mainly deal among themselves and their activities , together with those of the largest Hedge Funds, moves the markets.

Retail traders are hugely insignificant because they comprise just about 2% of the market. Retail traders also do not have access to Order Flow information from these big banks because it is strictly kept secret by the banks.

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For those who are inclined to “play” with volume in the spot market, I would suggest they try to gain access to Bloomberg terminal, Reuters data feeds (IFR Markets), and Market News International’s Bullet Points.

I think it is possible to get a good idea of how volume is behaving by comparing the trickles of volume data that can be gleaned from these sources and combine it with something like Market Profile techniques. This is for the tough minded : top-notch/excellent trading risk management is critical to a trader’s success.

The volume indicators provided by various retail forex brokers is utterly useless. They do not even approximate the actual market volume because they only show the activities of traders who are using their own trading platform – in order words, a subset of less than total retail traders’ trading volume, which is really just 2% of total global spot forex volume. It’s all a big joke.

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I conclude by saying this : Ignore what happens in the retail forex market. Dance more with those who move the markets. Retail traders are being deceived by “The Establishment”.

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