Relative Volume and Session Comparisons
Relative volume compares observed volume with a defined historical baseline. The numerator and denominator must refer to comparable times and sessions for the ratio to be meaningful.
How it works
A full-day ratio often divides today’s volume by a preceding daily average. An intraday comparison should use volume accumulated by the same time in comparable sessions. Exclude today from its own baseline unless that choice is deliberately documented. Handle holidays, shortened sessions and split adjustments.
Worked example
At 10:30, today’s accumulated volume is 600,000 shares. The preceding 20 comparable sessions averaged 300,000 by 10:30, so time-matched relative volume is 2.0. Comparing the same 600,000 with full-day average volume of 1,200,000 produces 0.5 and answers a different question.
Amounts, prices and scenarios are fictional teaching examples. They exclude any effects not explicitly stated and are not trade recommendations.
Limits and common mistakes
Scheduled news, index rebalances and a single block print can drive the ratio. A high reading does not identify buyers, guarantee liquidity at your size or establish direction. Baselines near zero can produce extreme unstable ratios.
Knowledge check
What is wrong with comparing morning volume only to full-day volume?
Read the explanation
It confounds session progress with unusual participation. Use the same elapsed trading time to assess whether current activity is unusually high.
References and further reading
These sources explain the underlying concepts and specifications. They do not endorse QBMFX Academy. Check the relevant market, protocol version and reporting rules before applying an example.