Volume Bars Explained:
How Volume Is Displayed on Charts?
Learn how volume bars are displayed on a chart and how to read them alongside price action.
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This lesson explains how volume is typically displayed visually on a chart, using volume bars.
This is general educational content explaining a standard charting element.
What Are Volume Bars?
Volume bars are typically displayed as a separate panel beneath the main price chart, with each vertical bar representing the trading activity (as covered in the previous lesson, this is tick volume for spot forex) for the corresponding period shown on the price chart above.
How Volume Bars Are Typically Color-Coded
Volume bars are often color-coded to match the corresponding candle's direction — for example, a green or white volume bar beneath a bullish candle, and a red or black volume bar beneath a bearish candle — making it easier to visually associate volume levels with price direction for that same period.
Reading Volume Bars Alongside Price
Volume bars are meant to be read directly alongside the corresponding price action for the same period, rather than in isolation. A tall volume bar underneath a period with a large price move (covered in the earlier candle size and momentum lesson) is generally discussed differently than a tall volume bar underneath a period with relatively little price movement.
Relative, Not Absolute, Interpretation
Volume bars are generally most useful when interpreted relative to an instrument's own recent, typical volume levels, rather than as an absolute number compared across different instruments. What counts as a "high" or "low" volume bar varies significantly between different instruments and even between different timeframes for the same instrument.
🔖 Summary
Volume bars display trading activity as a separate panel beneath the price chart, typically color-coded to match the corresponding candle's direction, and are meant to be interpreted alongside price action for the same period rather than in isolation. Since typical volume levels vary significantly between instruments and timeframes, volume bars are most useful when interpreted relative to an instrument's own recent history, rather than as an absolute, universal figure.
Frequently Asked Questions
How are volume bars typically displayed?
As a separate panel beneath the main price chart, with each bar representing trading activity for the corresponding price period.
How are volume bars typically color-coded?
Often to match the corresponding candle's direction, such as green/white for bullish periods and red/black for bearish periods.
Should volume bars be read in isolation from price?
No, they're meant to be read alongside the corresponding price action for the same period, not in isolation.
Is there a universal 'high volume' threshold?
No, volume is generally most useful when interpreted relative to an instrument's own recent, typical levels, since this varies significantly between instruments and timeframes.
Risk Warning
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