Negative Volume Index (NVI) Indicator Explained

The Negative Volume Index (NVI) is PVI's mirror: it updates only when volume falls — the quiet sessions when, per Paul Dysart's old thesis, the smart money operates while the crowd is absent. Decades of study (notably Fosback's) found NVI one of the better long-horizon bull-market indicators.

How It Works

• On lower-volume bars: NVI compounds by the percent price change.
• On higher-volume bars: unchanged.
• The classic read: NVI above its 255-bar average = high probability bull regime.

How to Trade It

Use NVI as a slow regime gate for long-biased systems: full size while NVI holds above its long average, defensive posture when it breaks below. Price rising on quiet days (rising NVI) while crowd days churn is the fingerprint of durable accumulation.

Building It in Setup.Cash

Add Negative Volume Index (NVI) in the strategy builder — the length input controls its sensitivity — and use its value in any entry, exit, or filter condition. You can also combine it with other tools in the Indicators Lab or via the AI indicator generator. Pairs with the Positive Volume Index for the full picture. For the full category overview, see the volume indicators library guide.

Volume tools need volume data, so they shine on crypto and stocks. Backtest on the exact symbols and feed you plan to trade.