📊 VOLUME FLOW INDICATOR ANALYSIS for Binary Options

VOLUME FLOW INDICATOR ANALYSIS for Binary Options (We Need to Talk About This)
Over the past few years, many volume analysis tools for binary options have emerged.
Most of them reflect the worldview of their creators, projecting their personal understanding of the subject.
This led to the rise of important concepts, giving binary options traders a new reasoning model to master—something already well understood by analysts in institutional desks, forex markets, and global exchanges.

BINARY OPTIONS are undoubtedly a type of trading that attracts people worldwide as an easier way to open an account and take their first steps.
In countries like Brazil, for example, the regulatory body classifies binary options as derivatives, although they are not legalized in the country.
There’s no denying the large community of binary options enthusiasts.
Many reach out to me on Telegram seeking indicators and solutions to help them, and many confess they’re in serious trouble due to poor results.
One thing is certain: never in history have binary options brokers profited so much from traders’ capital losses.
Because of this, we aim to raise the level of trading, trying to flip this unfair game.
We will create a trading instrument that truly helps traders take money from binary options brokers—using all available knowledge, research, and ideas.
The first step is undoubtedly to create a volume indicator, understanding that it reveals what’s happening inside the candle, giving clues about what occurred and what’s likely to happen next.
The main idea is not to design it to show what we want.
As mentioned earlier, current tools reflect the creators’ desires and views.
But here, we want to build something neutral, that doesn’t express my vision, but the realistic view of the market—showing exactly what’s happening inside the candle without interference or calculations that try to mold it to my understanding.
So if we let the monitoring capture and express exactly what’s happening inside the candle, what will it show us?
What failures occur and why?
Where are the true flows of large volumes that hold the price at that moment?
What drives the price and why?
We want to know all of this.

DATA COLLECTION:
My initial goal is to create the indicator (prototype already ready), then capture data and use artificial intelligence trained with this data to discover true volume patterns that tell us:
When this happens, trade in this direction.
By mastering volume concepts, I truly believe the game can drastically shift in favor of binary options traders.
Our final goal is to reach a point where brokers will try everything to block the use of this technique—because they can no longer afford to lose so much money.
Will we get there?
Let’s begin our journey.

THE FIRST STEP WAS TO DEVELOP THE PROTOTYPE.
A task far from simple, since in the forex market—the charts from which we need to obtain data—there is no real volume.
So the first step was to discover how we could emulate real volume using tick volume, which represents each smallest movement made by a candle. Later, we had to determine how it could be considered a down tick or an up tick. This was even more difficult because in the models I found online, an up tick was considered positive volume and a down tick negative volume. Here lies the first problem: a candle can move upward and still have negative volume. This certainly misleads many when analyzed with currently available tools. Therefore, we need to find a way that truly expresses what is happening, identifying whether it is positive or negative regardless of the candle’s movement or direction. Remember, our goal here is to let the volume reflect reality without personal interventions or formulas.

To make the data even more precise, I need it to group very close values. Otherwise, if a candle occurs with more than 1000 ticks, we would have 1000 levels, making it impossible to find a meaningful pattern and likely causing crashes in MetaTrader, which we do not want.
With the grouping of very close values, we can cluster them and allow the system to develop dynamically, providing information such as: between price X and price Y, a certain amount of volume occurred, and between buyers and sellers the result was a positive balance of 3 buys. This would be the delta value—the difference between buyers and sellers. This means that at this level, buyers are stronger.
So, does a candle with mostly buying volume mean the next candle will rise? Wrong.

Market manipulation happens all the time, even on the 1-minute timeframe. This is incredible because only through volume can we see it. These are exactly the flaws we will seek in Volume Flow Analysis, from which we will take great advantage, aiming to find patterns that truly make sense and finally understand why at certain moments traders are buying and yet the price still goes down.


THE FIRST

LET’S UNDERSTAND SOME FEATURES OF THE FIRST PROTOTYPE:
With the volumes properly created, I sought to add two important functions so we can understand what is happening.
Two different POCs were added.

POC is the point where the greatest accumulation of volume occurred in a given period.
Since I am using 10 candles, the first POC in yellow on the chart shows that, summing the 10 monitored candles, in which region—adding them all together—the greatest volume occurs, at which level, at which price?

The horizontal line in yellow on the chart demonstrates this. Its color can be modified in the user settings.





The other POC is directly related to identifying which candle among those monitored has the highest volume within this period.
This means that this POC can move more quickly on the chart whenever a volume surpasses the current highest.

An interesting function of this POC is that it changes color to red if the highest candle volume is negative, and green if the identified volume is positive.
In this way, we can know whether the reaction of the volume occurring in this region seeks to break through it. Since it is positive or negative, we can determine through the volume happening at that exact moment whether there is enough strength to break it or if there is not much strength to do so.




We can also identify the POC, the moment of highest volume within the candle, with the bar marked in yellow.

The volume bars also bring us important information.
We have the bars forming the levels where buying and selling occurred within the candle, where:
Green bars indicate buyers,
Red bars indicate sellers,
The values in front of the bars indicate the delta value, that is:
the difference between buyer and seller, or who won the negotiation at each level within the candle.

I also added the highlight function, with the objective of finding similar volume in the same region.
When hovering the mouse pointer over a volume bar, it shows where other volumes occurred at the same price, sums all the volumes that happened at that price, prints on the screen which price it was, whether the total volume is positive or negative, and in how many candles it occurred.

This will help a lot because when the current price is happening, I can check the strength of the movement at that exact moment and whether the amount of volume in that region is more buyer or seller. This will make the difference, since in a support or resistance zone and even at the POC we can know whether it has enough strength to break or if it will retrace.


This can be observed because when I place the mouse over a volume, it changes the color of the volume to white in the candles where it occurred at the same level. The color can be set in the user settings.

Percentage verification was added to identify which is the predominant volume of the candle.
My goal is to find divergences where there is a lot of selling volume but the candle is bullish, or a lot of buying volume and the candle is bearish.
According to the research conducted, volume divergence signals are powerful for predicting direction.
This is the first step after obtaining data and, upon verifying it, finding a very interesting dynamic: in volume divergences, the accuracy rate exceeds 90% success.
Now implemented, let’s move on to testing.

A very interesting volume pattern.
Observe that in the main chart we have a support marked in red.
In the previous candle, notice in the volume profile that there was a large sell at the bottom of the candle, indicating strength to break this support.
With no effort at all, it was enough to sell to achieve victory.

Here is truly the volume pattern I imagined finding.
We are in a downtrend and had a bullish candle, however the predominant volume in the candle was from sellers, as can be observed in the percentage above the candle.
So even though the candle was bullish, through the volume we can see what really happened inside the candle and avoid traps.

A few candles ago I saw that a support was formed which at the moment was changed, but I left it marked as can be observed in the white line on the chart, and the volume of the candle where it occurred was extremely high as can be seen in the image. So I marked this moment so that when the price reached this region I could execute a sell.

As in the previous candle, the executed order also had a positive volume in the same location equal to the sell I was monitoring, that is +9. I used the feature of checking similarities and placed the mouse over the positive volume +9, and the total sum of all volumes from all candles that occurred in this region was still -4, meaning that despite the strong buying at the moment, the sellers were still stronger.

A very interesting discovery that only volume analysis allows us:
When we have an empty space that is considerable, at least 1/4 of the candle, there will be an increase in volatility.
When the following candle reaches this region, volatility increases and retraces very aggressively.

Bullish candle touching resistance but with negative volume.
The sell is certainly very strong in this case.
We can sell without fear.

This really left me with a very sincere doubt:
We had a bearish candle with positive volume, indicating that despite being a bearish candle, most of the players were buyers. Normally, this would be a buy. However, at the bottom of the candle, we had a considerably large empty volume space. Naturally, the price could drop to fill this empty area.
It seems that the filling is more powerful than the volume divergence.

Everything indicated it would be a buy and break the resistance, since the aggressive volume in the candle pointed to buyers. However, this empty space below showed that it needed to be filled—and that is exactly what happened.

An exaggerated accumulation of buying volume upon touching the resistance.
Many here would sell, but the volume revealed the great trap: a high buying volume at the top of the candle exactly at the resistance.
This caused the next candle to break aggressively as if the resistance was nothing.

Notice that while the volume is developing, the previous candle broke a resistance, so I wanted to know if there was enough strength to keep buying.
When I place the mouse over the volume happening now, it shows me across all monitored candles where the main volumes occurred and were traded at this price, displaying the total strength by summing them all.
It was very positive, indicating that it would continue to rise.

Once again we had a very clear moment that always repeats:
High volume at the top of the bullish candle.
The top of the candle touches the resistance.
The next candle still ends as a doji, but the majority volume was buying.
So I just bought.
This was the last one for today, my friends.
Now I need to rest because it’s been more than 24 hours working on this indicator.
Is this interesting for you? Leave me a message if you’re interested on Telegram @code88br

Last Update:
We are making some modifications to achieve greater accuracy in the data, obviously with the goal of further optimizing results. Below is what has been modified and what we currently have in the indicator:
Modified:

1. In the previous version, we had the display of the percentage of the volume profile of each candle, indicating who was dominant in the volume, whether buyers or sellers.
2. Although interesting, this did not show who was truly the dominant volume, since we could have a large number of buyers and yet the candle’s strength could be predominantly selling.

Therefore, a substitution was made and the DELTA value was added, which is the subtraction of buyer volume from seller volume.
This clearly indicates who actually dominated the candle, regardless of the total volume that occurred.
It gives us a clearer view of what is really happening inside the candle and helps avoid trading traps where there may be many buyers, but the more aggressive trades are being made by sellers.

As can be observed, we can have a very large candle with almost no real volume in it, and we can have a very small candle with enormous potential because it concentrates a lot of volume.
This turned out to be truly incredible as it gives us genuine traces of major traders.




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Another Important Update:
We now have the calculation of buying or selling pressure for all candles monitored within the selected period in the indicator.
This means that all volumes occurring at the current price will be added or subtracted and displayed through a special delta.
What Is This For?

1. Imagine having a support at price 1.1234.
2. When the price reaches this support again, you will know if there are many sellers at this price, which means it will push the price toward a breakout.
3. Or if instead there are buyers in large volume, which means the price will respect this support.

This is truly magical, as it identifies whether we need to pay attention to certain levels or not.
It clearly shows whether the price will go up or down without deceiving at any moment.

Now we will begin testing the efficiency of this and how much better it has become.

This became easily identifiable:
It touched the resistance,
The volume delta was very negative despite the candle being a bullish candle at that moment.
The volume was clearly signaling that sellers were stronger.