Relative Volume (RVOL)

Relative Volume (RVOL) compares current trading volume against the historical average volume for the same time period. Rather than comparing to a single daily average, proper RVOL calculations compare volume at 10:30am against average 10:30am volume, at 11:00am against average 11:00am volume, and so on — because volume patterns within the trading day are highly consistent and the opening hour always has higher volume than midday.

Why RVOL Matters More Than Absolute Volume

A stock trading 2 million shares in the first hour might be high or low activity depending on its typical daily volume. If the stock normally trades 10 million shares per day (roughly 1.3 million in the first hour), 2 million in the first hour represents RVOL of about 1.5× — above average but not exceptional. If the stock normally trades 300,000 shares per day (roughly 40,000 in the first hour), 2 million in the first hour represents RVOL of 50× — an extreme outlier that almost certainly indicates a catalyst event.

RVOL as Confirmation Signal

RVOL confirms that unusual activity is underway. An RVOL of 5× or more suggests that a significantly larger-than-normal number of market participants are transacting in the stock — which typically means new information is being priced in. For catalyst traders, RVOL is one of the key confirmation signals: a catalyst with high RVOL is more likely to produce a sustained directional move than a catalyst with normal volume, because high RVOL indicates broad market awareness of and reaction to the news.

RVOL Thresholds

Common RVOL reference points: 1–2× is normal-to-slightly-elevated. 2–5× is elevated — worth attention. 5–10× is significantly elevated — likely a catalyst or major technical break. 10×+ is extreme — almost always associated with a significant catalyst event. The TradeAI News velocity scoring subsystem (SS2) incorporates RVOL as one of its primary inputs for measuring real-time market reaction strength.