Technical Indicators: Volume

Volume is an important technical indicator. Volume shows the number of shares traded at a specific time frame, for example daily as shown below. Usually volume does not provide a buy or sell signals by itself but it can you help analyzing price moves.

 


 

 

High volume usually shows the beginning of new trend. High volume is often present near the bottoms of the market as seen on the chart above. Relative low volume shows indecisive expectations of the traders. Volume spikes usually occur when there is a sudden drop or increase in stock prices.

 

 

 

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