Volume Acceptance Bands [PhenLabs]

• Each bar’s volume is normalized against a rolling mean and standard deviation over the lookback period
• A bar is flagged as a spike when its z-score exceeds the threshold (default: 2.0)
• Zero-stdev environments (flat volume) are safely handled to prevent division errors

• Consecutive spike bars accumulate into a cluster
• The cluster’s high/low envelope is tracked in real time
• Once the cluster reaches the minimum duration (default: 2 bars), the acceptance range locks in
• A non-spike bar resets the cluster tracker

• Displayed as a label the moment a new cluster locks in
• Formula: CQS = volume z-score × wick rejection ratio
• Wick rejection ratio measures how strongly price closed toward one extreme of the spike bar
• Higher CQS = stronger cluster = more meaningful acceptance zone

• Acceptance: Price is inside the acceptance range — neutral background, no signal
• Expansion: Price closes (or wicks, user-configurable) beyond the band with optional volume confirmation — bullish teal background + triangle marker
• Mean-Revert: Price breaches a band but closes back inside — bearish red background + triangle marker

• All state assignments and signal markers fire inside barstate.isconfirmed
• No request.security calls — no lookahead of any kind

• Z-score volume anomaly detection — statistically principled, not a simple MA multiple
• Three-state regime classifier with per-state visual identity (Acceptance / Expansion / Mean-Revert)
• Cluster Quality Score — original composite metric combining volume strength and wick rejection
• Persistent acceptance range — survives until the next qualifying cluster overwrites it
• Breakout confirmation toggle — close-beyond vs wick-beyond prevents wick trap false signals
• Volume confirmation gate for Expansion — optional requirement that breakout bars are themselves volume spikes

• Volume Lookback | Default: 20 | Range: 5–200 | Bars used to compute the rolling z-score baseline
• Z-Score Threshold | Default: 2.0 | Range: 0.5–6.0 | Minimum z-score to classify a bar as a volume spike. Higher = rarer clusters
• Min Cluster Duration | Default: 2 | Range: 1–20 | Consecutive spike bars required to lock in an acceptance range

• Require Close Beyond Band | Default: ON | ON = breakout requires a close beyond the band; OFF = a wick is sufficient
• Require Volume Confirmation for Expansion | Default: ON | Expansion signals also require the breakout bar to be a volume spike

• Background Shading | Default: ON | Shades chart background by current market state
• Show Cluster Quality Score | Default: ON | Shows CQS label when a new cluster locks in
• Show Expansion / Mean-Revert Signals | Default: ON | Triangle markers on state-change bars

• Acceptance Background, Expansion Background, Mean-Revert Background
• Upper Band, Lower Band, Band Fill
• Expansion Signal, Mean-Revert Signal

• VAB — Expansion Breakout: fires on confirmed Expansion state bars
• VAB — Mean-Revert Rejection: fires on confirmed Mean-Revert state bars
• VAB — New Cluster Locked: fires the bar a new acceptance zone is established (includes CQS value in message)

• Teal upper band = acceptance zone ceiling
• Red lower band = acceptance zone floor
• Filled channel = the active acceptance range
• Teal background = Expansion (confirmed breakout)
• Red background = Mean-Revert (failed breakout / rejection)
• Neutral/gray background = Acceptance (price inside range)
• Orange label = Cluster Quality Score fires when a new zone is established

• Works on all markets with reliable volume data: equities, crypto, futures, forex
• Best on 15m, 1H, 4H, and Daily timeframes where volume clusters are most meaningful
• A higher Z-Score Threshold (3.0+) produces fewer but higher-conviction clusters — useful on higher timeframes
• A lower Z-Score Threshold (1.5–1.8) produces more clusters — useful for scalping on lower timeframes
• CQS above 1.5 generally indicates a high-conviction acceptance zone worth watching
• Combine with a trend filter: take Expansion signals in the direction of the prevailing trend only

• Trend filters (EMA, VWAP) to qualify Expansion direction
• Support/resistance zones to anticipate Mean-Revert locations
• Volatility tools (ATR-based) to size positions on Expansion breakouts

⚠️ DISCLAIMER

This indicator is for educational and research purposes only. It is not financial advice and does not constitute a trading recommendation. Past performance in backtests or historical evaluations does not guarantee future results. Always conduct your own due diligence before making any trading or investment decisions.