The Bid/Ask is designed to show the net number of contracts that traded on the bid
or ask price during the development of each bar/candle during trading. This indicator
will work on a time, tick or volume based chart but we believe that it is most effective
if used on a volume based chart for the market that you are tracking.
The objective of this study is to let you know if more sellers are hitting the bid
or more buyers are hitting the ask (offer) price and by doing so gives you a heads
up as to where the pressure is coming from.
If used on a volume based chart then you are always comparing like with like when
comparing the number of contracts traded at bid/ask from bar to bar. If you use
a tick or time based chart then you will always have a different number of contracts
traded each bar/candle because tick and time based charts do not have equal contract
traded on each bar/candle.
This study shows the net number of contracts traded on the ask. If more contracts
traded on the bid than the ask then this number will be negative. The example results
below shows what this indicator will plot on a 3000 contract per bar volume chart:
|
Result
|
Contracts traded at Ask
|
Contracts traded at Bid
|
|
+3000
|
3000
|
0
|
|
+1000
|
2000
|
1000
|
|
-2000
|
500
|
2500
|
|
-3000
|
0
|
3000
|
!!! Note: It will not work on historical
data. Realtime datafeed only !!!