MAVOL vs. Chaikin Money Flow (CMF): which is better for crypto?

Understanding MAVOL in Cryptocurrency Analysis

MAVOL, or Moving Average Volume, is a technical indicator that applies the concept of moving averages to trading volume rather than price. In the context of cryptocurrency, where volume often reflects market sentiment and participation, MAVOL helps traders identify trends in buying and selling pressure over a specified period. The calculation involves averaging the volume data across a set number of previous periods—commonly 7-day, 14-day, or 30-day intervals. For example, a 14-day MAVOL sums the total trading volume over the past 14 days and divides it by 14. This smoothed volume line can then be plotted on a chart to compare against current volume levels.

When current volume exceeds the MAVOL, it may signal increased interest or momentum, often preceding price breakouts. Conversely, volume below the MAVOL may suggest waning interest. Traders use this divergence to anticipate reversals or confirm trends. One advantage of MAVOL in crypto markets is its simplicity and direct focus on volume dynamics, which are especially volatile in digital asset trading. Unlike price-based indicators, MAVOL does not incorporate price directly, making it a standalone tool for assessing market activity.

Decoding Chaikin Money Flow (CMF) for Crypto Traders

Chaikin Money Flow (CMF), developed by Marc Chaikin, combines price and volume to measure the strength of money flowing into or out of an asset. It operates on the principle that closing prices near the top of the day’s range indicate accumulation, while closings near the bottom suggest distribution. The CMF formula calculates a 21-day average of the Money Flow Multiplier multiplied by volume. The multiplier is derived from the position of the close within the high-low range.

To compute CMF:

• Calculate the Money Flow Multiplier: [(Close – Low) – (High – Close)] / (High – Low)
• Multiply this by the day’s volume to get Money Flow Volume
• Sum the Money Flow Volume over 21 days
• Divide by the total volume over the same period

The resulting value oscillates between -1 and +1. A reading above +0.05 suggests bullish momentum, while below -0.05 indicates bearish pressure. In crypto, where sudden inflows and outflows occur frequently, CMF can highlight institutional or whale activity more effectively than volume alone. Its integration of both price and volume makes it a composite indicator, offering a more nuanced view than MAVOL.

Comparing Signal Clarity: MAVOL vs. CMF

When evaluating signal clarity in fast-moving crypto markets, each indicator has distinct strengths. MAVOL excels in identifying surges in volume that may precede price movements. For instance, if Bitcoin’s volume spikes to double its 14-day MAVOL, it could foreshadow a breakout. This signal is easy to interpret and requires minimal calculation. Traders can overlay MAVOL directly on volume bars in platforms like TradingView and visually assess deviations.

In contrast, CMF provides a more refined signal by factoring in where the price closed relative to the day’s range. A sustained CMF above zero during a sideways market may indicate hidden accumulation, even if price appears stagnant. However, CMF can generate false signals during periods of high volatility, such as during major news events or exchange outages. For example, a sharp price drop on high volume might push CMF deeply negative, but if the close is near the high of the candle, the selling pressure may be overstated.

Step-by-Step: Implementing MAVOL on Trading Platforms

To apply MAVOL on a cryptocurrency trading chart:

• Open TradingView or Binance Trading Interface
• Select the cryptocurrency pair (e.g., BTC/USDT)
• Navigate to the Indicators section
• Search for “Volume” and add it to the chart
• Click on the volume indicator and select “Add to Volume Pane”
• Apply a moving average to the volume: use the formula sma(volume, 14) for a 14-day MAVOL
• Customize the line color and thickness for visibility
• Adjust the period based on trading strategy—shorter for scalping, longer for swing trading

This MAVOL line will now appear as a smoothed curve over the volume bars. Traders can set alerts when current volume crosses above or below the MAVOL line, helping automate detection of unusual activity.

Step-by-Step: Setting Up Chaikin Money Flow on Crypto Charts

Configuring CMF requires slightly more technical input:

• Launch TradingView and load a crypto price chart
• Click “Indicators” and search for “Chaikin Money Flow”
• Select the built-in CMF indicator (default period is 21)
• Apply it to the chart; it will appear in a separate pane below price
• Adjust settings if needed: change length to 14 for faster signals or 28 for smoother data
• Observe the zero line: values above indicate buying pressure, below indicate selling
• Combine with price action: look for bullish divergences (price down, CMF rising) or bearish divergences (price up, CMF falling)

Some platforms allow customization of the formula. For manual setup, use:cmf = sum(MoneyFlowVolume, 21) / sum(volume, 21)This ensures accuracy across different exchanges.

Use Cases in Real Crypto Market Scenarios

During the Bitcoin bull run of 2021, MAVOL on the 7-day timeframe surged as retail adoption increased. Exchanges like Coinbase reported record volumes, and MAVOL spikes correlated with price breakouts above $40,000 and $60,000. Traders using MAVOL could have entered early by noticing volume consistently above the moving average.

In contrast, Ethereum’s consolidation phase in Q3 2022 showed flat price action but CMF gradually rising above zero. This indicated quiet accumulation despite low volatility. Traders monitoring CMF might have positioned ahead of the eventual rally post-Merge. CMF’s ability to detect subtle money flow gave it an edge in this scenario.

For altcoins like Solana (SOL), which experience sharp pumps and dumps, CMF can warn of exhaustion. A price spike accompanied by CMF declining below zero suggests weak participation, even if volume is high. MAVOL would show high volume but miss the bearish divergence in closing prices.

Frequently Asked Questions

Can MAVOL and CMF be used together effectively?Yes. Combining MAVOL to detect volume surges with CMF to assess the quality of that volume improves decision-making. For example, a volume spike above MAVOL and CMF rising above zero confirms strong bullish momentum.

Is CMF reliable on low-cap cryptocurrencies?CMF can be less reliable on low-cap cryptos due to manipulative volume and thin order books. Sudden whale trades may distort the close price, leading to misleading CMF readings. Use it cautiously and cross-verify with on-chain data.

Does MAVOL work better on specific timeframes?Shorter timeframes (1H, 4H) benefit from 7-day MAVOL for scalping, while daily charts often use 14 or 30-day MAVOL for trend confirmation. Adjust based on volatility and trading style.

Why does CMF sometimes lag during fast crypto moves?CMF uses a 21-period average, which introduces inherent lag. Rapid price changes may not be immediately reflected. Consider using a shorter period (e.g., 14) for more responsive signals in turbulent markets.