Price-Volume Correlation Strength (PVC)

Overview

The Price-Volume Correlation Strength (PVC) indicator is a behavioral-analysis tool that quantifies the relationship between price movement and volume participation to distinguish true directional moves from false momentum or exhaustion traps.
It combines dynamic price–volume correlation logic, signal clustering, liquidity-sweep detection, and multi-day reference levels into a single, data-driven framework that adapts across all markets and timeframes.

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1️⃣ Core Logic — Price vs Volume Correlation

At the heart of PVC is the belief that price without volume confirmation is deception.
The script evaluates whether volume supports or contradicts price direction using a rolling volume average and short-term price delta:

Price Direction Volume Behavior
↑ Price + ↑ Volume True Bull Move ✅ — Healthy rally with strong participation
↑ Price + ↓ Volume False Bull Move ⚠️ — Buyer exhaustion or fake breakout
↓ Price + ↑ Volume True Bear Move ✅ — Active selling pressure
↓ Price + ↓ Volume False Bear Move ⚠️ — Short covering / weak decline

Candles are automatically color-coded so that traders can instantly identify whether the current move is being supported (lime/red) or rejected (gray) by the underlying volume dynamics.


2️⃣ Signal Module — Trend Confirmation & Reversal

PVC tracks sequences of consecutive “true” bars to generate BUY or SELL signals once momentum aligns with sustained volume confirmation.
A built-in signal-strength filter (user-adjustable) ensures that only moves with multi-bar confirmation are considered.
Signals are non-repainting: once triggered, they persist until an opposite direction is confirmed.

3️⃣ Liquidity Sweep Engine

Markets often manipulate recent highs/lows to trigger stops before true reversals begin.
The Liquidity Sweep Engine detects these events by comparing current highs/lows to prior extremes and validating them with above-average volume bursts.

• Bullish Sweep (Blue dot below bar): liquidity taken below prior lows, buyers absorb volume → potential reversal up.
• Bearish Sweep (Blue dot above bar): liquidity taken above prior highs, sellers absorb volume → potential reversal down.

This module helps traders recognize Smart Money traps and stop-hunt zones that precede major turning points.

4️⃣ Adaptive Dashboard

A compact, on-chart dashboard summarizes the market state in real time:
• Price Direction — UP / DOWN / FLAT
• Volume Trend — RISING / FALLING
• Move Validity — True / False Move
• Signal Status — Active Buy / Sell / Mixed
• Recent Sweeps — Bull / Bear / Both / None

Border and grid colors are user-configurable for visual clarity.

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5️⃣ Multi-Day OHLC & VWAP Suite

To complement the intraday correlation engine, PVC integrates a Multi-Day OHLC module that automatically projects up to 10 previous-day levels (High, Low, Close, and VWAP).
These act as natural liquidity magnets and reaction zones where price often pauses or reverses.
Users can customize:
• Line colors for each level type
• Universal or per-type line thickness
• Number of days to display (1–10)

This turns the indicator into a complete context map—linking current price–volume behavior with historical reference levels.

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6️⃣ Alerts & Practical Use

Built-in alerts trigger on:
• True Bull Move / True Bear Move (momentum confirmation)
• Buy / Sell Signals (multi-bar strength filter)
• Bullish / Bearish Liquidity Sweep (stop-hunt detection)

Best use cases
• Identify whether a breakout is real or fading before entering.
• Confirm reversals with simultaneous volume confirmation + liquidity flush.
• Combine with VWAP or structure tools to align with institutional footprints.

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7️⃣ Why PVC is Original

While most volume indicators only show totals or ratios, PVC focuses on behavioral correlation—the timing and agreement between price change and participation.
By merging price–volume validation, trap detection, and multi-day liquidity mapping inside one unified system, PVC provides a contextual narrative of market strength that no single classic indicator offers.

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How to Use
1. Apply on any timeframe or instrument.
2. Observe candle colors for confirmation or divergence.
3. Watch the dashboard: when both Price UP + Volume Rising + True Move + Buy Active, the move has strong backing.
4. If “False Move” or “Liquidity Sweep” appears, expect a possible reversal.
5. Align entries with daily VWAP/High/Low zones for confluence.

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⚠️ Disclaimer

This script is for educational and analytical purposes.
It does not constitute financial advice or a guaranteed signal system.
Always confirm with your broader trading strategy and risk management.

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