What it is
PVI is the twin of the Negative Volume Index. Where NVI follows the quiet candles, PVI builds a price path out of the busy ones, when news and crowd activity lift volume.
It has no settings to tune. Like NVI it starts at a base value such as 1,000 and is read against its own moving average. Many traders show NVI and PVI together: both above their averages is a strong backdrop, both below a weak one.
How it is calculated
1. Start PVI at a base value, for example 1,000. 2. Compare each candle's volume with the previous candle's volume. 3. If volume is higher: PVI = previous PVI x (1 + percentage change in close). 4. If volume is the same or lower: PVI stays unchanged. 5. Add a long moving average of PVI as the signal line.
How to read it
How to trade it
- 1
Use daily charts of US30 or NAS100.
- 2
Use PVI above its own average, ideally with NVI too, as the backdrop for long swing trades.
- 3
Enter on a price trigger, such as a daily close above a short consolidation.
- 4
Stop below the consolidation low, sized for the large daily ranges on indices.
- 5
Stop taking new longs once PVI closes below its own average.
The bullish backdrop is cancelled when PVI closes below its own average, showing busy candles have turned negative.
WickSpeak writes a plain-English reading of PVI on the live candle: what it is, whether busy candles have been lifting or dropping price, how traders use it and what would prove the reading wrong. In Playbook, a condition can check when PVI crosses above or below its own average, is above or below its own average, or is rising or falling. Pairing it with an NVI condition gives the classic two-index filter.
Best markets and timeframes
Built for daily charts of stock indices. On intraday CFD charts the busy candles are mostly session opens and news, so the reading tells you more about those events than about the crowd's long-term view.
Common mistakes
- Expecting timely entries. It is a slow, background measure.
- Reading PVI alone without checking NVI, which gives the other half of the picture.
- Applying it on 1 minute charts, where volume rises and falls with the clock.
Works well with
Questions traders ask
What does the Positive Volume Index measure?
It measures price change on candles where volume rose from the previous candle. It shows what the market does when activity picks up.
How do you use PVI and NVI together?
Plot both against their long moving averages. Both above is a supported uptrend, both below a weak market, and a split shows the crowd and the quieter trade disagree.
What moving average is used with PVI?
A 255 period EMA on daily charts is traditional, roughly one trading year. Shorter averages give faster but noisier signals.
Is PVI useful for day trading?
Not very. On intraday charts volume rises mostly because of session opens and news, so PVI mainly reflects those events.