The linked article refers to using and average on volume to...

  1. 93 Posts.
    The linked article refers to using and average on volume to compare the range using numbers picked from the air. This is unnecessary if you are just eye-balling charts and are used to it — the experts in Wyckoff never seem to need it.
    The power of averages on volume and true range is apparent when scanning large numbers of stocks for particular behaviours we would like to identify. You would need to experiment but I use a 21-day period simply because that is an average month of trading days. Average True Range traditionally uses Wilders averaging but I prefer the exponential moving average of the true range. Volume and true range need to be normalised to percentages. A scan that shows a stock with volume 300% of average volume and a true range 10% average true range might be of interest.
    Hope that helps.
 
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