The first EMA takes into account volume with sign like OnBalanceVolume: the volume is considered negative when the Close price of the corresponding bar is lower than that of the previous bar, and positive otherwise.
Two averages are calculated for the VZO: the first one is price related EMA of volume, the second is general EMA of volume. Unlike VolumeOsc, the VZO uses price data along with volume. The Volume Zone Oscillator (VZO) is a technical indicator analyzing volume changes in relation to certain levels (zones).
Let’s take a look to see how the ThinkOrSwim documentation defines VZO:
Before we write any code to build the VZO Indicator, let’s first understand what it even is.
