How to Add a Moving Average to the Volume Bars on a Chart
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When it comes to examining volume bars, moving averages can be very important in cutting through the noise and presenting a clearer picture of volume, by smoothing out daily fluctuations and highlighting unusual volume days. And just like with moving averages on a typical price chart, you can add moving average lines to volume bars on a chart as well.
The Volume setting in the Chart Attributes area of the SharpCharts Workbench is a “shortcut” way to add volume to a chart with the default configuration. If you want to adjust the Volume configuration (for example, adding a moving average to the volume bars), you will need to use the “Volume” indicator instead.
This in-depth tutorial walks you step-by-step through the process of converting volume from a chart setting to an indicator, then adding a 20-day moving average to the volume bars.
In this step-by-step tutorial, we'll create a chart with a 20-day moving average on the volume bars.
There are several ways to create a new SharpChart, but the easiest is to enter the symbol in the Create-a-Chart box at the top of the page and then hit return or click Go.
To simplify the chart, let's remove any Indicators and Overlays from the default chart. The quickest way to do that is to click the Clear All link in the Overlays section and then repeat the process with the Clear All link in the Indicators section.
The chart should look similar to the one below.
Note: You may want to make other changes to the chart, such as changing the size or the color scheme. In the above chart, we used the “Spruce” color scheme.
In order to add a moving average to, or otherwise change the configuration of, the volume bars on your chart, you will need to turn off the "shortcut" Volume setting in the Chart Attributes area, and then add the configurable "Volume" indicator to your chart.
To remove the “shortcut” Volume from the chart, change the Volume dropdown in the Chart Attributes area to Off.
Select Volume from one of the empty indicator dropdowns. Ensure the Position dropdown is set to Behind Price so volume will appear on the main chart panel.
Once these changes have been made, your chart should look similar to the one below.
Notice that the chart looks the same as the previous one. However, now that Volume is an indicator, you have more options for configuring the volume display.
There are two options for adding a moving average to your volume indicator.
The preferred method is to use the Advanced options to add the moving average.
Find the Overlay dropdown menu next to your Volume indicator, and select the kind of moving average you want to add to your volume bars (Simple Moving Avg or Exp. Moving Avg). In the Parameters box to the right of the Overlay dropdown, enter the number of periods you want for your moving average.
The finished chart will look similar to the one below.
If you need a quick (EMA) overlaid on your Volume bars, enter the number of periods for your moving average in the Parameters box for your Volume indicator. Note that you can only enter an EMA using this option.
