Volume Oscillator
The percentage difference between a short and a long moving average of volume.
Formula
Volume Oscillator = (Short-Period Volume MA - Long-Period Volume MA) / Long-Period Volume MA x 100
Unit
%
In depth
The indicator isolates whether recent participation is above or below its own norm, independent of price direction — a positive reading simply means activity has picked up. Expressing it as a percentage makes it comparable across securities with wildly different average volumes, which raw volume is not. Its limitation is that it cannot distinguish buying interest from selling interest, since every trade has both sides. It is a measure of activity, and this dictionary attaches no directional meaning to it.
Worked example
A 5-period average volume of 4,20,000 shares against a 20-period average of 3,00,000 gives (4,20,000 - 3,00,000) / 3,00,000 x 100 = 40%. Participation is 40% above normal; whether buyers or sellers drove it is not answerable from this number.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Volume Oscillator” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.