Relative Volume (RVOL)¶

OVERVIEW¶

Relative Volume (RVOL) is the ratio of a stock's current trading volume to its typical volume at the same point in the session over a historical lookback period. It quantifies how unusual today's trading activity is compared to the norm.

RVOL Reading	Interpretation
0.7 or below	Below-average activity — choppy, mean-reverting conditions likely
1.0	Exactly average volume for this time of day
2.0–3.0	Elevated activity — potential catalyst, news, or rotation
5.0 and above	Extreme activity — institutional flow, earnings, or major catalyst

Note

RVOL is a coincident indicator, not a leading one. By the time RVOL spikes to 5.0, the move is typically already underway. Use it to identify where to look, not when to enter.

HOW IT WORKS¶

Cumulative RVOL (Tapeboard Default)¶

RVOL = Volume Today So Far ÷ Average Volume at Same Time-of-Day over N Days

Tapeboard uses cumulative RVOL with a 20-day lookback. At any given moment during the session, today's cumulative volume is compared against the average cumulative volume at that exact time of day across the prior 20 trading days. This corrects for the intraday U-shape volume distribution — naturally heavy at the open and close, light mid-session.

Daily RVOL (Reference Only)¶

RVOL = Today's Total Volume ÷ N-Day Average Daily Volume

The daily formulation (N = 20 or 50) is only meaningful after the close. Intraday, it produces artificially low readings early in the session and artificially high readings near the close, regardless of whether genuine unusual activity is occurring.

Tip

Always use cumulative RVOL for intraday scanning. The daily version will mislead you before 3:00 PM ET.

WORKED EXAMPLE¶

AMD — Earnings Beat Scenario

20-day average daily volume: 45 million shares
Historical average volume through 10:30 AM ET: 14 million shares
Today's volume by 10:30 AM ET: 42 million shares (earnings beat estimates by 18% overnight)

Method	Calculation	Result	Accurate?
Cumulative RVOL	42M ÷ 14M	3.0	Yes — 3× normal pace
Daily RVOL	42M ÷ 45M	0.93	No — implies below-average volume

The cumulative method correctly surfaces the unusual activity. The daily method incorrectly signals below-average volume because the full trading day has not elapsed.

GME — January 2021 Short Squeeze

GME sustained RVOL readings above 15.0 for five consecutive sessions during the January 2021 short squeeze — a historically extreme level that preceded the vertical price move.

HOW TO USE¶

Scanning for Unusual Activity¶

Use RVOL as a primary scanner filter to isolate stocks in play. Tapeboard's recommended baseline universe filter:

Parameter	Minimum Value
Price	$2.00 or $5.00
Average Daily Volume	1,000,000 shares
RVOL Threshold	2.0 – 5.0

Common Trading Applications¶

Gap-and-go setups High RVOL on a morning gap confirms genuine institutional interest versus a thin premarket fade that is likely to reverse.

Breakout confirmation A price break above resistance on RVOL > 3.0 has substantially higher follow-through probability than the same break on RVOL of 0.8.

Avoiding chop Stocks with RVOL below 0.7 tend to mean-revert within their opening range. Avoid momentum strategies on low-RVOL names.

Earnings and catalyst trades RVOL is the cleanest real-time proxy for whether the broader market is actively participating in a move.

Tip

Always pair RVOL with price action and VWAP. RVOL is direction-agnostic — a reading of 10.0 can occur in a vertical rally or a vertical collapse.

LIMITATIONS¶

Limitation	Detail
Coincident, not leading	The spike confirms a move already in progress — not a predictive entry signal
Early-session distortion	Low-float and premarket movers produce extreme RVOL in the first 5 minutes that often normalize by 10:00 AM ET
No directional signal	RVOL does not distinguish between bullish and bearish volume — always combine with VWAP and price action
Lookback window contamination	If a catalyst (earnings, news) occurred within the 20-day lookback, the denominator is inflated and current RVOL will appear suppressed
Seasonal stock distortion	Stocks with predictable seasonal volume patterns (HD in spring, retail at Black Friday) produce unreliable RVOL comparisons
RVOL ≠ dollar volume	A $2 stock with 100M shares traded carries huge RVOL but minimal notional turnover — use dollar volume or options open interest to track institutional flow