Welcome

First of all, welcome and thank you for visiting my blog... Here are a few things for you to ponder about... 1) Do you feel shy when posting your questions or comments on blogs because most people there are already experts? 2) Do you have problem finding or asking the most basic questions about the stock market? Well, you have reached the right blog... This is a blog for anyone who wants to learn more about the stock market. Particularly for beginers. However, some of you may find it too basic. However, I'm not here to teach or to lead... But as I have mentioned, this is a learning blog.... And learning is an ongoing process. So if you are patient enough and continue to stay with me, you will be able to see our progress as we share and learn more with each passing day. So if you have any questions or comments or suggestions, do feel free to post here. I will try to find the answers from other sources and experts elsewhere... And to those experts out there, please do drop by and give us comments and advices ya.. Thank you so much.. By the way, when you are free, you may visit another blog of mine that is about chinese tea culture... Do drop by and relax after a hard day of battle...

Wednesday, April 23, 2008

How to use Volume


How to use volumes…. This itself is long enough to write a few articles… :P first of all, how to use volumes depends on what method you are adapting to…. to start from basic, volume is formed when transaction is done… every transaction or every volume means an agreement of price between buyers and sellers…. Volume is like and indicator for the sustainability of trend…. To make it simple, it is like fuel for the flame… the flame represents the trend, no matter up or down… so, if you see volume dying down, it shows signs of dying flame too…. and vice versa… simple? :P

Now, homework….
1) Are the statements correct?
a. Low volume equals illiquid.
b. Low volume equals price is about to drop.
2) What is true low volume and what is relative low volume? What is the significance?

Ok, lets go a bit deeper, if we are using trends or phases… how do we incorporate volume into them? Basically, we can generally divide the trend into three types or phases:
3) Uptrend
4) Downtrend / Distribution
5) Range bound

How does volume come in? Well, as stated above, when we see price moving uptrend, a healthy one will be accompanied with increasing volume because this means more people agree and supports the increasing price… so we can say it is sustainable…. and vice versa…

How about range bound? during range bound, volume is also normally in range… why? Because less transactions involved… now, towards the end of range, volume will pick up… because there will be more and more people involved and more transactions are being done… this is called public participation…

Homework:
1) Does public participation or volume picking means that uptrend is next?
2) Revise a bit on supply Vs demand.

Ok, stop here first, leave the deeper stuff for later… :P do post your answers and questions if you don’t understand or require further information…


Regards and happy learning

9 comments:

Anonymous said...

Interesting to know.

manu said...

explained well,but could have been more detailed.
manu-http://stocktipsnanalysis.blogspot.com

Anonymous said...

Hello are using Wordpress for your blog platform?

I'm new to the blog world but I'm trying to get started and create
my own. Do you require any coding expertise to make your own blog?
Any help would be really appreciated!

Look into my webpage: seo hosting plans

Anonymous said...

I could not refrain from commenting. Exceptionally well written!


Feel free to visit my web page - http://onurbridals.com

Anonymous said...

Hello to every one, for the reason that I am
really keen of reading this web site's post to be updated daily. It includes pleasant material.

Feel free to visit my weblog http://gown4wed.com/vintage-clothing-trends-this-fall/

Anonymous said...

I think that is among the most vital information for me.
And i'm happy reading your article. However want to remark on some common things, The web site taste is ideal, the articles is truly great : D. Good process, cheers

Feel free to visit my web site; http://myinsanestories.com/top-5-most-popular-online-wholesale-Clothing-stores.html

Anonymous said...

This text is worth everyone's attention. How can I find out more?

Also visit my web-site ... http://bestmoneysavingdeals.com/online-shopping-for-kids-clothes/

Anonymous said...

Hi there! This post could not be written much better!
Looking at this article reminds me of my previous roommate!
He constantly kept talking about this. I am going to send this
information to him. Pretty sure he's going to have a very good read. Thank you for sharing!

Visit my web blog; http://mail-smart.com/?p=25

Anonymous said...

Its such as you read my mind! You seem to understand
so much approximately this, like you wrote the ebook in it
or something. I feel that you can do with a few % to pressure the
message house a bit, but other than that, that is fantastic blog.
A fantastic read. I'll definitely be back.

My blog post - http://www.american-ss.net/facial-fat-loss/outdoor-clothing-why-buy-from-online-stores/