The Volume Flow Confluence Indicator combines two volume-analysis methods: Chaikin Money Flow (CMF) and the Klinger Volume Oscillator (KVO). It displays a histogram only when both indicators align in their respective signals.
Signal States:
• Green Bars: CMF is positive (> 0) and KVO is above its signal line • Red Bars: CMF is negative (< 0) and KVO is below its signal line • No Bars: When indicators disagree
Technical Components:
Chaikin Money Flow (CMF): Measures the relationship between volume and price location within the trading range: • Calculates money flow volume using close position relative to high/low range • Aggregates and normalizes over specified period • Default period: 20
Klinger Volume Oscillator (KVO): Evaluates volume in relation to price movement: • Tracks trend changes using HLC3 • Applies volume force calculation • Uses two EMAs (34/55) with a signal line (13)
Practical Applications:
1. Signal Identification - New colored bars after blank periods show new agreement between indicators - Color intensity differentiates new signals from continuations - Blank spaces indicate lack of agreement
2. Trend Analysis - Consecutive colored bars show continued indicator agreement - Transitions between colors or to blank spaces show changing conditions - Can be used alongside other technical analysis tools
3. Risk Considerations - Signals are not predictive of future price movement - Should be used as one of multiple analysis tools - Effectiveness may vary across different markets and timeframes
Technical Specifications:
Core Algorithm
CMF = Σ(((C - L) - (H - C))/(H - L) × V)n / Σ(V)n KVO = EMA(VF, 34) - EMA(VF, 55) Where VF = V × |2(dm/cm) - 1| × sign(Δhlc3) Signal Line = EMA(KVO, 13)
Signal Logic Long: CMF > 0 AND KVO > Signal Short: CMF < 0 AND KVO < Signal Neutral: All other conditions Parameters
CMF Length = 20 KVO Fast = 34 KVO Slow = 55 KVO Signal = 13 Volume = Regular/Actual Volume
• Marc Chaikin - Original CMF development • Stephen Klinger - Original KVO development • Alex Orekhov (everget) - CMF script implementation • nj_guy72 - KVO script implementation
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