Relative Volume (RVOL)

Relative volume standardises activity so that the open of the session does not always look like a climax. A stock that has traded 20 percent of its daily average in the first fifteen minutes may be perfectly normal, because the open is when it usually trades. RVOL compares the pace with the pace at the same point on prior days. A reading of 3 with the session half done means this day is already in unusual territory. That is the number news traders and breakout traders actually mean by "heavy volume."

Compute it against comparable sessions. A Monday open is not always like a Friday open, and an expiry day is not like a mid-week day. The better averages exclude event days or at least do not let one earnings bar set the baseline forever. RVOL can be read on the bar too: this five-minute bar versus the average five-minute bar at 10:05. Bar-level RVOL is noisy. Session-pace RVOL is the stabler use.

Use RVOL to decide whether a breakout has participation right now, not whether the day might end up busy. A breakout at RVOL 0.6 is a quiet push. A breakout at RVOL 2.5 is being traded. Use very high RVOL as a risk flag as well. Slippage, halts, and spreads live in those sessions. Do not fade a level only because RVOL is high. High relative volume is how trends start and how they end.

Dividing by the full-day average at 10:00 and concluding the stock is "light." You compared a half hour with a whole day. Also using a baseline that includes the earnings spike you are trying to detect a repeat of, which makes today look ordinary.

RVOL needs a stable calendar and a clean average. New listings, trading halts, and half days break the comparison. And the ratio says nothing about the sign of the close. Twice normal volume on a reversal bar and twice normal volume on a trend bar are opposite trades.