Table of Contents
1. Overview
Volume Signals is a trading alert system that detects significant volume anomalies and market conditions across multiple timeframes. This guide provides optimized configurations for different trading strategies and timeframes.
2. Core Configuration Parameters
Volume Spike Detection
- enable_volume_spike_signal: Activates volume spike detection
- volume_spike_multiplier: Threshold multiplier vs average volume (e.g.,
2.0= 200% of average) - volume_lookback_period: Number of periods used to calculate average volume baseline
Volume Dry Detection
- enable_volume_dry_signal: Activates low volume detection
- volume_dry_multiplier: Threshold for low volume (e.g.,
0.3= 30% of average)
Alert Actions
- supported_volatility_action: Actions monitored by the system
- supported_volatility_action_broadcast: Actions that trigger notifications
3. Trading Strategy Configurations
Scalp Trading (1m - 5m intervals)
Optimal for: Quick entries/exits, high-frequency trading, capturing micro-movements
Recommended Timeframes
- Primary: 1m, 3m
- Confirmation: 5m
Configuration
# SCALP Strategy - 1m/3m intervals
enable_volume_spike_signal: true
enable_volume_dry_signal: false
volume_spike_multiplier: 1.5 # Lower threshold for faster signals
volume_dry_multiplier: 0.4 # Stricter low volume detection
volume_lookback_period: 14 # Shorter lookback for responsiveness
supported_volatility_action:
- "BUY"
- "SELL"
- "PUMP"
- "CRASH"
supported_volatility_action_broadcast:
- "PUMP"
- "CRASH"
- "VOLUME_SPIKE_BUY"
- "VOLUME_SPIKE_SELL"
Why These Settings?
- Lower multiplier (1.5x): Catches smaller volume spikes quickly
- Shorter lookback (14): More reactive to recent market conditions
- Disabled dry signals: Low volume is less relevant for scalping
- Selective broadcasts: Focus on extreme movements (PUMP/CRASH)
Day Trading (5m - 30m intervals)
Optimal for: Intraday positions, capturing daily price swings, session-based trading
Recommended Timeframes
- Primary: 5m, 15m
- Confirmation: 30m
Configuration
# DAY Trading Strategy - 5m/15m/30m intervals
enable_volume_spike_signal: true
enable_volume_dry_signal: true
volume_spike_multiplier: 2.0 # Standard threshold
volume_dry_multiplier: 0.3 # Standard low volume detection
volume_lookback_period: 20 # Balanced lookback period
supported_volatility_action:
- "BUY"
- "SELL"
- "PUMP"
- "CRASH"
supported_volatility_action_broadcast:
- "BUY"
- "SELL"
- "PUMP"
- "CRASH"
- "VOLUME_SPIKE_BUY"
- "VOLUME_SPIKE_SELL"
Why These Settings?
- Standard multiplier (2.0x): Balanced sensitivity for intraday moves
- Medium lookback (20): Captures typical intraday volume patterns
- Dry signals enabled: Helps identify consolidation periods
- Full broadcasts: All signals relevant for day trading decisions
Swing Trading (30m - 6h intervals)
Optimal for: Multi-day positions, capturing trend reversals, reduced monitoring
Recommended Timeframes
- Primary: 1h, 2h
- Confirmation: 6h
Configuration
# SWING Trading Strategy - 1h/2h/6h intervals
enable_volume_spike_signal: true
enable_volume_dry_signal: true
volume_spike_multiplier: 2.5 # Higher threshold for significant moves
volume_dry_multiplier: 0.25 # Very low volume detection
volume_lookback_period: 30 # Longer lookback for trend context
supported_volatility_action:
- "BUY"
- "SELL"
- "PUMP"
- "CRASH"
supported_volatility_action_broadcast:
- "PUMP"
- "CRASH"
- "VOLUME_SPIKE_BUY"
- "VOLUME_SPIKE_SELL"
Why These Settings?
- Higher multiplier (2.5x): Filters noise, focuses on major volume events
- Longer lookback (30): Better trend context over days
- Strict dry signals (0.25x): Identifies true consolidation zones
- Selective broadcasts: Reduces alert fatigue, focuses on significant moves
Long-Term/Position Trading (6h - 1d intervals)
Optimal for: Long-term holdings, major trend identification, minimal monitoring
Recommended Timeframes
- Primary: 12h, 1d
- Confirmation: Multi-day analysis
Configuration
# LONG-TERM Strategy - 12h/1d intervals
enable_volume_spike_signal: true
enable_volume_dry_signal: false
volume_spike_multiplier: 3.0 # Very high threshold
volume_dry_multiplier: 0.2 # Not typically used
volume_lookback_period: 50 # Extended lookback for macro context
supported_volatility_action:
- "PUMP"
- "CRASH"
supported_volatility_action_broadcast:
- "PUMP"
- "CRASH"
Why These Settings?
- Very high multiplier (3.0x): Only major institutional movements
- Extended lookback (50): Captures long-term volume averages
- Dry signals disabled: Irrelevant for position trading
- Minimal actions: Focus only on extreme market conditions
4. Timeframe-Specific Guidelines
| Speed | Use Case | Risk | Recommendation | Lookback |
|---|---|---|---|---|
| Ultra-Fast (1m - 3m) | Scalping, market making | High false signals | Combine with price action confirmation | 10-15 periods |
| Fast (5m - 15m) | Day trading, momentum trading | Moderate noise | Use multiple timeframe confirmation | 15-20 periods |
| Medium (30m - 2h) | Swing trading, intraday position holds | Low false signals | Strong reliability, ideal for most traders | 20-30 periods |
| Slow (6h - 12h) | Position trading, trend following | Delayed signals | Excellent for trend confirmation | 30-50 periods |
| Very Slow (1d) | Long-term investing, portfolio rebalancing | Very delayed entry/exit | Use for strategic decisions only | 50-100 periods |
5. Alert Actions Explained
- BUY
Volume spike with upward price movement
Indicates accumulation or bullish interest
Best for: Entry signals in uptrends - SELL
Volume spike with downward price movement
Indicates distribution or bearish pressure
Best for: Exit signals or short entries - PUMP
Extreme volume spike (typically 3x+ average) with rapid price increase
Often indicates FOMO or coordinated buying
Warning: High risk of reversal - CRASH
Extreme volume spike with rapid price decline
Indicates panic selling or major news
Warning: Can signal capitulation (potential bottom) - VOLUME_SPIKE_BUY
Significant volume increase on buying side
More nuanced than generic BUY signal
Best for: Confirming breakout validity - VOLUME_SPIKE_SELL
Significant volume increase on selling side
More nuanced than generic SELL signal
Best for: Confirming breakdown validity
6. Advanced Configuration Tips
Multi-Timeframe Confirmation
Use nested confirmations for higher probability setups:
- Entry Signal: 5m volume spike
- Confirmation 1: 15m shows same direction
- Confirmation 2: 1h trend alignment
Dynamic Multiplier Strategy
Adjust multipliers based on market conditions:
- High Volatility Markets: Increase multiplier (2.5-3.0x)
- Low Volatility Markets: Decrease multiplier (1.5-2.0x)
- Trending Markets: Enable dry signals to spot reversals
- Ranging Markets: Focus on extreme PUMP/CRASH only
Notification Optimization
For Active Traders (Scalp/Day):
supported_volatility_action_broadcast:
- "BUY"
- "SELL"
- "VOLUME_SPIKE_BUY"
- "VOLUME_SPIKE_SELL"
- "PUMP"
- "CRASH"
For Swing/Long Traders:
supported_volatility_action_broadcast:
- "PUMP"
- "CRASH"
7. Common Pitfalls & Solutions
| Problem | Solution |
|---|---|
| Too Many False Signals | Increase volume_spike_multiplier by 0.5 increments |
| Missing Major Moves | Decrease volume_spike_multiplier or shorten volume_lookback_period |
| Alert Fatigue | Narrow supported_volatility_action_broadcast to critical actions only |
| Conflicting Signals Across Timeframes | Use higher timeframe as filter, lower timeframe for entry timing |
8. Quick Reference Table
| Strategy | Timeframes | Spike Mult. | Lookback | Dry Signal | Key Focus |
|---|---|---|---|---|---|
| Scalp | 1m, 3m, 5m | 1.5x | 14 | No | Speed & Volume |
| Day | 5m, 15m, 30m | 2.0x | 20 | Yes | Balance & Confirmation |
| Swing | 1h, 2h, 6h | 2.5x | 30 | Yes | Quality & Trend |
| Long | 12h, 1d | 3.0x | 50 | No | Major Moves Only |
9. Integration with Other Indicators
Volume signals work best when combined with:
- Price Action: Candlestick patterns, support/resistance
- Momentum: RSI, MACD for overbought/oversold
- Trend: Moving averages for direction confirmation
- Volatility: Bollinger Bands, ATR for context
Example Combined Setup:
- Volume spike on 15m + RSI oversold + Support bounce = High-probability long
- Volume dry on 1h + Price at resistance + Bearish divergence = Possible reversal
10. Backtesting Recommendations
Before going live, test configurations with historical data:
- Run at least 3-6 months of data
- Track win rate, average profit/loss per signal
- Adjust multipliers based on your risk tolerance
- Note false signals during major news events
- Optimize lookback period for your specific market
11. Final Notes
- Start Conservative: Begin with higher multipliers and adjust down
- Paper Trade First: Test configurations without real capital
- Market Context Matters: Crypto behaves differently than stocks
- Combine Signals: Never trade on volume alone
- Stay Disciplined: Follow your plan, ignore FOMO
Support: For issues or questions, consult your platform's documentation or community forums.