Forex Trader Pro is a powerful trading platform that allows traders to access a wide range of tools and features to help them make informed trading decisions. One of the most important pieces of information that traders need to know is the volume of trading activity in a particular market. In this article, we will explain how to display volume on Forex Trader Pro, including what volume is, why it is important, and how to use it to inform your trading decisions.
What is Volume?
Volume refers to the total number of shares or contracts that are traded in a particular market during a given period of time. In the forex market, volume is typically measured in lots, which represent a standard unit of currency. For example, one lot of EUR/USD represents 100,000 euros.
Why is Volume Important?
Volume is an important indicator of market liquidity, which refers to the ease with which traders can buy and sell assets in a particular market. High volume generally indicates that there is a lot of trading activity in a particular market, which can make it easier for traders to enter and exit positions quickly and at a fair price.
In addition, high volume can also indicate the strength of a particular trend. For example, if there is a strong uptrend in a particular currency pair and the volume is also increasing, this can be a sign that the trend is likely to continue. Conversely, if there is a strong downtrend and the volume is decreasing, this can be a sign that the trend may be running out of steam.
How to Display Volume on Forex Trader Pro
To display volume on Forex Trader Pro, you will need to follow these steps:
Step 1: Open the Market Watch Window
The first step is to open the Market Watch window, which displays a list of all the currency pairs that you are able to trade on the platform. To open the Market Watch window, simply click on the ‘Market Watch’ tab at the bottom of the platform.
Step 2: Select a Currency Pair
Next, select the currency pair that you want to trade by clicking on it in the Market Watch window. This will display the chart for that currency pair in the main trading window.
Step 3: Add the Volume Indicator
To add the volume indicator to the chart, click on the ‘Indicators’ button at the top of the platform. This will open a menu of all the indicators that are available on Forex Trader Pro.
Scroll down this menu until you find the ‘Volume’ indicator. Click on this indicator to add it to the chart.
Once you have added the volume indicator, you should be able to see a graph of the volume of trading activity for that currency pair. The volume indicator typically appears as a bar chart at the bottom of the main chart.
Using Volume to Inform Your Trading Decisions
Now that you know how to display volume on Forex Trader Pro, the next step is to use this information to inform your trading decisions. Here are some tips on how to do this:
1. Look for High Volume Breakouts
One of the most common ways to use volume is to look for high volume breakouts. This occurs when a currency pair breaks out of a trading range or other key level on high volume.
High volume breakouts can be a sign of a significant shift in market sentiment, which can create new trading opportunities. For example, if the EUR/USD currency pair breaks out of a long-term downtrend on high volume, this could be a signal to buy the pair and take advantage of the new uptrend.
2. Watch for Divergences
Another way to use volume is to watch for divergences between price and volume. This occurs when the price of a currency pair is moving in one direction, but the volume is moving in the opposite direction.
Divergences can be a sign of a potential reversal in the market, as they indicate that there is a disconnect between price and volume. For example, if the price of the USD/JPY currency pair is moving higher, but the volume is decreasing, this could be a sign that the uptrend is losing momentum and may soon reverse.
3. Use Volume to Confirm Trends
Finally, you can use volume to confirm trends in the market. This involves looking for situations where the volume is increasing along with the price of a currency pair.
If you see that the price of a currency pair is moving higher on increasing volume, this can be a sign that the uptrend is likely to continue. Conversely, if the price is moving lower on increasing volume, this can be a sign that the downtrend is likely to continue.
Conclusion
In conclusion, volume is an important indicator of market liquidity and can be used to inform your trading decisions in a number of ways. By following the steps outlined in this article, you can easily display volume on Forex Trader Pro and use this information to improve your trading strategy. Whether you are a beginner or an experienced trader, understanding how to use volume can help you to make more informed trading decisions and increase your chances of success in the forex market.
