Relative Volume
Relative Volume, or RVOL, compares today’s volume against the average volume over a recent period (often 20 days). A RVOL of 1.0 means trading is normal; 2.0 means twice the average; 3.0 means three times. Indian traders use RVOL as a real-time screen for stocks that suddenly attract abnormal interest — often the earliest sign of a tradeable setup.
Key takeaways:
- RVOL = today’s volume / average volume over N days.
- RVOL > 2 typically signals significant interest or news.
- RVOL < 0.5 indicates quiet conditions — usually unsuitable for breakouts.
- Helps filter stocks during scans for breakout, gap and momentum setups.
- Default lookback is 20 trading days; some traders prefer 50 for smoother averages.
How RVOL is computed
For each session, sum cumulative volume traded up to the current time and divide by the average cumulative volume at the same time over the past N days. The result tells you whether the stock is trading faster than usual.
Why RVOL matters
Volume validates price moves. A breakout on average volume is suspect; a breakout on 3× volume is a high-conviction signal. RVOL is the simplest way to quantify this. It also helps separate “news-driven” moves from “random noise” — a stock making a 3% move with RVOL 1.5 is different from one making the same move with RVOL 0.7.
Common use-cases
- Earnings scans: Screen for stocks with RVOL > 2 in the first hour after results.
- Breakout filters: Buy breakouts only when accompanied by RVOL > 1.5.
- Gap-and-go setups: Confirm a gap with sustained RVOL above 2 throughout the day.
- Pump alerts: Sudden RVOL > 5 in a small-cap may indicate manipulation; tread carefully.
RVOL across different time frames
| RVOL window | Best for |
|---|---|
| 5-day RVOL | Day-of-trade scans, news plays |
| 20-day RVOL | Standard breakout filter |
| 50-day RVOL | Long-term unusual activity |
Pitfalls to avoid
- Don’t blindly buy stocks with high RVOL — confirm with price-action and trend.
- Holiday-shortened sessions can distort RVOL; consider excluding such days.
- Stock-specific surveillance (ASM, GSM) often spikes RVOL artificially.
- For small-caps with thin volume history, RVOL can move violently on tiny absolute changes.
Combining RVOL with other tools
RVOL pairs well with VWAP, breakout patterns and gap analysis. A favourite tactic among Indian intraday traders is: scan for stocks above pre-market high with RVOL > 2 and price above VWAP — a high-probability momentum filter. Keep stops just below VWAP or yesterday’s close.
Frequently asked questions
What RVOL is too high?
There is no fixed ceiling. RVOL > 5 is unusual and may indicate news or manipulation; verify before trading.
Is RVOL useful for mutual funds?
No — mutual funds do not have intraday volume. RVOL applies to exchange-traded instruments only.
Can I use RVOL on Nifty futures?
Yes — RVOL on Nifty futures highlights expiry days, news days, and event-driven sessions.
Does Lemonn provide RVOL?
Yes. Lemonn’s charting tool includes Relative Volume as a standard indicator.
