Volume and market depth

Volume and market depth describe activity, but their meaning depends on the data source. Before interpreting a chart, ask exactly what is being measured.

Forex has no single global order book

Spot FX is decentralised. A broker or venue may show only its own available quotes and orders. That is a partial view, not a complete map of global buying and selling. Listed currency futures have exchange-specific data, but they are different instruments from an OTC forex contract.

Tick volume versus traded volume

Tick volume usually counts price updates within a period. Traded volume counts contracts or units exchanged on a particular venue. Both can be useful observations, but they are not interchangeable. Check the indicator’s definition before comparing charts or claiming that “the whole market” is active.

Reading market depth

Displayed bids and offers show available liquidity at particular prices on the feed. Orders can be cancelled, changed or executed. A large displayed order does not guarantee support or resistance, and unseen liquidity may exist elsewhere. Thin displayed depth can be associated with larger execution uncertainty.

Volume indicators

OBV accumulates volume according to the direction of price changes. VWAP weights prices by the volume in its calculation. Their interpretation depends on the underlying feed, session definition and instrument. An indicator cannot repair incomplete or unsuitable data.

Fair value gaps

In some price-action methods, a fair value gap is a three-candle pattern where the first and third candles’ wicks do not overlap across part of the middle candle’s move. It is a chart convention, not direct evidence of an empty global order book or a guarantee that price will return.

Your next steps

Check whether your chart uses tick volume or traded volume. Note the provider, instrument and time zone. Compare activity around a scheduled announcement on a demo chart, and record what the data supports without assuming a predictable outcome.