Been backtesting different volume indicators for the past few months but getting mixed results.
Sometimes they nail the breakouts perfectly, other times they give false signals that cost me decent profits.
Wondering if anyone actually relies on volume analysis for entries or if it’s just noise.
Volume works better as confirmation than prediction tool honestly.
Volume indicators can spot momentum shifts but they work best when combined with price action rather than used alone.
I use them mainly to confirm when a breakout has real strength behind it instead of trying to predict where price will go next.
The false signals usually happen when you rely on volume without checking what the actual chart pattern is telling you.
Forex volume is tricky since it’s not centralized like stocks. I mostly ignore it and focus on support resistance levels instead.
Volume in forex is synthetic data from most retail brokers. The numbers you see aren’t real market volume since there’s no central exchange.
Real institutional volume stays hidden. What retail platforms show is just their internal order flow or estimated activity.
This explains your mixed backtesting results. You’re analyzing manufactured data that doesn’t reflect actual market participation.
Stick to price action and market structure instead. These show what actually happened with real money, not broker estimates.