FAQ about AVL Indicator

1. What is the AVL (Accumulation/Distribution) Indicator?

The AVL Indicator measures the relationship between trading volume and price movement. It helps to identify whether an asset is being accumulated (bought) or distributed (sold) based on the flow of volume.

2. How to interpret AVL in an uptrend?

In an uptrend, if the AVL rises, it indicates that investors are accumulating, which confirms that the trend is likely to continue. If the AVL begins to fall, it may be a sign that the trend's strength is weakening.

3. What does it mean when AVL falls in a downtrend?

If the AVL continues to fall in a downtrend, this indicates that there is continued selling pressure, which may confirm that the downtrend will persist.

4. How to use the AVL Indicator in futures?

In futures, AVL can help identify potential reversal points. A rise in AVL during a pullback could signal that buyers are moving in, while a fall during a rally could signal that sellers are taking control.

5. Can AVL predict trend changes?

AVL does not directly predict trend changes, but divergences between AVL and price (for example, price going up and AVL going down) can be early signs of a potential reversal.

6. Should AVL be used alone or in conjunction with other indicators?

AVL is most effective when combined with other indicators, such as RSI or moving averages, to confirm signals and make more informed decisions.$BTC