Volume Analysis

Volume analysis involves examining the number of shares or contracts traded during a specific period to gain insights into market activity. High volume often indicates strong investor interest and can confirm the direction of a price move, while low volume may suggest a lack of conviction. By studying volume alongside price patterns, traders can better assess the strength of a trend, identify potential reversals, and make more informed decisions about entry and exit points in the market. It’s a valuable tool for understanding the intensity behind price movements.