Volume Delta Bubble + Absorption

📊 Overview

A sophisticated volume analysis tool that identifies unusual buying/selling pressure and detects absorption patterns in real-time. This indicator combines statistical volume analysis with smart price action detection to reveal hidden market dynamics.
🔍 Key Features
1. Unusual Volume Detection

Statistical Z-Score Analysis: Flags statistically significant volume spikes using adaptive thresholds

Dual Detection Modes: Choose between adaptive (Z-Score) or fixed volume threshold methods

Volume Delta Calculation: Compares buying vs selling volume based on price movement

2. Smart Absorption Detection 🎯

Directional Absorption: Identifies WHO is absorbing whom:

B-ABS: Bullish Absorption (Buyers absorbing selling pressure)

S-ABS: Bearish Absorption (Sellers absorbing buying pressure)

Context-Aware Logic: Uses price rejection/support levels to determine absorption direction

Streak Tracking: Monitors consecutive absorption bars for stronger signals

3. Visual Features 🎨

Color-Coded Bubbles:

Green: Bullish volume

Red: Bearish volume

Light Green: Bullish absorption

Light Red: Bearish absorption

Smart Placement: Automatically avoids label overlapping

Multiple Styles: Choose between circle or box label styles

Background Highlighting: Absorbing bars are highlighted for quick identification

4. Information Display 📈

Real-time Stats: Volume, Z-Score, and percentage above average

Info Table: Shows absorption trend, current Z-Score, and average volume

Detailed Tooltips: Hover over bubbles for comprehensive information

Absorption Markers: Small triangles indicate absorption bars

⚙️ How It Works
Volume Delta Calculation

The indicator calculates the net difference between buying and selling volume:

Volume Delta Mode: Uses lower timeframe close vs open

Candle Delta Mode: Uses current timeframe close vs open

Neutral Handling: Accounts for doji candles with partial attribution

Absorption Logic

Detects when high volume fails to move price significantly:

Small Body Check: Candle body < 60% of average (configurable)

High Volume: Volume > 1.5x average (configurable)

Direction Detection:

Bullish Absorption: High selling volume but price holds above previous low

Bearish Absorption: High buying volume but price rejects below previous high

Statistical Analysis

Z-Score Calculation: (Current Volume - Average Volume) / Standard Deviation

Adaptive Thresholding: Default Z-Score ≥ 2.0 (2 standard deviations)

Historical Comparison: Uses configurable lookback period (default: 60 bars)

🛠️ Customization Options
Detection Settings

Calculation Source: Volume Delta or Candle Delta

Lower Timeframe: Analyze volume from faster timeframes

Detection Mode: Adaptive (Z-Score) or Fixed volume threshold

Lookback Period: 10-200 bars for statistical calculations

Visual Settings

Bubble Opacity: 0-100% transparency

Label Styles: Circle or box format

Smart Placement: Auto-adjust to avoid overlap

Color Customization: Full control over all color schemes

Absorption Settings

Body Size Ratio: Adjust sensitivity (0.1-1.0)

Absorption Labels: Toggle B-ABS/S-ABS labels

Background Highlight: Toggle bar highlighting

📊 Output Information

Each bubble displays:

Volume: Formatted in millions (e.g., "1.25M")

Z-Score: Statistical significance (e.g., "Z:2.45")

Direction: Color-coded bullish/bearish

Absorption Type: B-ABS or S-ABS when applicable

🎯 Use Cases
For Traders:

Breakout Confirmation: Validate breakouts with volume support

Reversal Signals: Spot absorption at key support/resistance levels

Trend Continuation: Identify accumulation/distribution patterns

Risk Management: Avoid false breakouts with volume context

For Analysts:

Volume Profile Analysis: Understand institutional activity

Market Structure: Identify hidden support/resistance

Order Flow: Track buying/selling pressure in real-time

Statistical Edge: Use Z-Score for objective volume assessment

⚡ Pro Tips

Combine with Price Action: Use absorption signals at key S/R levels

Multi-Timeframe: Lower timeframe provides early signals

Confirmation: Wait for candle close before acting on signals

Risk Management: Use smaller position sizes on absorption signals

🔧 Technical Details

Built With: Pine Script v5

Maximum Labels: 500 (configurable)

Overlay: Yes (displays on main chart)

Calculation: On bar close (most accurate)

Performance: Optimized for real-time use

📱 Alert Conditions

Unusual Volume Delta: Triggers on statistically significant volume

Absorption Detected: Alerts when absorption pattern forms

Customizable: Set your own threshold levels

🎨 Design Philosophy

Clarity: Minimal, clean visual presentation

Information Density: Maximum insight with minimum clutter

Customizability: Every visual element is adjustable

User Experience: Intuitive for both beginners and professionals

📚 Educational Value

This indicator teaches:

Volume-price relationship

Statistical volume analysis

Absorption and distribution concepts

Order flow interpretation

Multi-timeframe analysis

🤝 Community Benefits

Open Logic: Transparent calculations for peer review

Educational: Helps traders understand volume dynamics

Customizable: Adapts to different trading styles

Reliable: Based on proven volume analysis principles

🚀 Why This Indicator?

Smart Detection: Goes beyond basic volume analysis

Directional Clarity: Clearly shows who's in control

Statistical Rigor: Uses Z-Score for objective signals

Professional Grade: Suitable for institutional analysis

Beginner Friendly: Clear visuals and explanations

Recommended Settings by Timeframe:

Scalping (1-5 min): Lower TF = "1", Z-Score = 2.5

Day Trading (15-60 min): Lower TF = "5", Z-Score = 2.0

Swing Trading (4H-Daily): Lower TF = "60", Z-Score = 1.8

Perfect for: Day traders, swing traders, volume analysts, institutional traders, and anyone wanting to understand the true story behind price movements through volume analysis.

Combine with price action and support/resistance levels for best results!