GlossaryVolatility Index
Volatility Index
The average range per candle as a percentage of the price, measured against the symbol's own normal volatility rather than against fixed thresholds. A 4% daily move is exceptional for a stock and a quiet day for a young coin; only the comparison with its own history is meaningful.
How to read it
- Volatility comes in waves. Long quiet phases below the baseline often precede large moves, but the curve does not reveal the direction.
- Extreme values usually occur at capitulations or breakouts and then fade again.
- The coloring uses today's baseline for the entire history. How unusual an earlier phase was at the time is shown by the distance to the gray line at that point.
Limitations
- As long as the history is shorter than the baseline window (on daily candles about 400 candles), there is no baseline and there are no zones.
- The reference lines stay at one, two and three times, even if you change the factors; the coloring follows the factors.
- The window counts candles: on a symbol that only trades on exchange trading days, 365 daily candles cover a little over 17 months.