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Volumeanalysis

Volume indicators. How do they work? Hello, traders! Today, I would like to talk about indicators and how you can utilize it in your trading journey. On Balance Volume The indicator is calculated cumulatively – the current value is determined as the sum of volumes over previous and current periods of the price chart. The sign is taken into account during summation: if the price increases during the period, the volume receives a positive value; if it decreased, the volume receives a negative value. As a result, traders obtain a tool that reflects the accumulation of long positions (indicator rises) or short positions (indicator falls) in trading. The indicator generates signals that anticipate movements in relation to the price chart. Its significant movements effectively confirm trends in quotes, and divergences with price charts provide signals with a high degree of reliability. Important note: This indicator is practically indispensable during flat market conditions – its growth or decline under these circumstances reveals market intentions, enabling precise determination of breakout from sideways movement and the direction of an impulse. How make to use of this? Utilize divergences as an additional framework indicating potential shifts in the current price trend. Accumulation/Distribution Developed by Larry Williams, this indicator suggests modifying the calculation of the On Balance Volume to account for the contribution of bulls and bears in each period. This involves considering the price movement during the period from opening to the maximum, minimum, and closing prices. As a result, a more precise tool for assessing position accumulation is created, while maintaining the same integral (filtering) properties. It's used in trading just like the On Balance Volume but generates quicker signals. On prolonged trends, the indications of these two indicators exhibit minimal differences. However, during corrections and flat market conditions, the Accumulation/Distribution indicator appears to be preferable. The Money Flow Index (MFI) The Money Flow Index (MFI) proves quite useful for traders familiar with the crypto scene. It serves as a volume-based indicator to assess whether the current temperature is running excessively hot or cold. Operating on such numbers of 0 to 100, the MFI closely resembles the (RSI). It also contains the data volume. When MFI readings surge above 80, it could signal an imminent price reversal, driven by a significant surge in buying activity. On the other hand, when it reaches 20 or even drops below it, we might be witnessing an abundance of selling pressure, potentially indicating oversold conditions. The true allure of the MFI lies in its ability to see divergences – a skill highly appreciated by traders. Divergence depends on the situation when the MFI decides to waltz to a different tune than the actual price movement, providing a potential heads-up for an impending trend reversal. Consider this scenario: Picture a cryptocurrency's price steadily climbing higher, while the MFI, descending from the point of 80 or above, tells a contradictory tale. This wink from the indicator suggests that the price might be gearing up for a reversal performance. Conversely, envision the MFI making an upward turn from the depths of, let's say, below 20, even as the price continues its downward journey. This cunningly indicates a possible upward reversal looming on the horizon – truly a game of market whispers. P/S: Every indicator has the right to thrive in the market, especially in algo trading while you create a network of robots. Among the options I'm fond of in the current market, on the Bitsgap platform, one can set up to take profits based on indicators. Currently, there are two choices: MACD+RSI. Hopefully, they'll introduce volume indicators over time. I'd be delighted to hear about your strategies and experiences with these indicators. Wishing you successful trades, traders!
Education
by Ingwina
1
Analyzing Potential Price Reversal on Nasdaq Using Technical IndIn recent market observations, the Nasdaq has displayed a noticeable downtrend, reflecting bearish sentiment. To gauge potential price reversal opportunities, a combination of technical indicators has been employed. Key Points: Point of Control (POC): Analysis of the volume profile revealed a significant Point of Control (POC) at a specific price level. POC can act as either a support or resistance level, depending on price movements. Fibonacci Retracement: The 61.8% Fibonacci retracement level, a renowned area of interest, coincides with the identified POC. This confluence highlights the potential significance of this level as a reversal point. Strong Support Level: Concurrently, the price is situated at a historically strong support level. This enhances the probability of a reversal, as this level has proven resilient against downward pressures in the past. Volume Decrease: An observation of declining trading volume in the current price area indicates waning participation and market exhaustion. This phenomenon can signal potential shifts in sentiment. Implications: While these technical factors collectively suggest the possibility of a price reversal, it's crucial to exercise caution and consider additional elements: Seek confirmation from complementary indicators like bullish candlestick patterns, positive divergence on momentum oscillators, or trendline breaks. Stay informed about relevant news events that could influence market sentiment, potentially overriding technical signals. Implement proper risk management techniques, such as setting stop-loss levels, to mitigate potential losses. Remember that while technical analysis provides valuable insights, it doesn't guarantee future price movements. A holistic approach that integrates technical, fundamental, and market sentiment analysis is essential for making informed trading decisions.
OANDA:NAS100USDLong
by Mag_tha_Trada
$ZOM Potent investment opportunityObserving the trading chart for this particular equity, it's evident that the security has been encapsulated in a range-bound, or "rectangular," pattern since 2018, with the central pivot point firmly established in the $0.20 vicinity. This technical analysis, combined with strategic stock purchases by the CEO and other insiders, signals a strong vote of confidence in the company's prospects. When we scrutinize the fundamentals, the recent earnings report paints an encouraging picture: a robust 43% surge in revenue, bringing it to $6.0 million, bolstered by an impressive gross margin of 67%. Additionally, the company's liquidity position remains strong, with $142.4 million on hand, providing ample financial flexibility. Given this confluence of positive signals, both from a technical and fundamental perspective, there's a compelling case to be made for this stock as a potent investment opportunity at this junction.
AMEX:ZOMLong
by AllHart
ARKM - Falling wedge, or over the edge? ARKM is a newly listed project that has a decentralized intelligence marketplace and ARKM can be utilized with the market. Since it's initial listing, price action has continued to slide under heavy selling pressure. Price is down ~50% from its highs. The reduced selling pressure can also be seen from the reduction in volume over time. If there is not a market wide directional event, we could see strong support at the zones i've illustrated. I've also added long position indicators for long positions, to gauge how the idea plays out relative to my thesis here. I would assert that one of these two support zones will act as a point of control that undergoes a test of resistance. Additionally, falling wedges with this volume profile can indicate a strong reversal. However, initial listings can be highly volatile and a breakdown of support would not surprise me either. I would put it at 60/40. Bull/bear.
by SpektreSignal
Tesla's Capitulation Bottom and the Significance of VolumeTesla, the renowned electric vehicle manufacturer, has experienced various phases in its market cycles, including a significant capitulation bottom. By examining the chart, it becomes apparent that volume played a crucial role in identifying key turning points and understanding market dynamics. I'd like to explore Tesla's capitulation bottom, the importance of volume, and its implications during the mark-up phase of a market cycle. Capitulation Bottom and Volume Analysis During Tesla's consolidation period from February to April 2023, the orange volume moving average line shows consistently above-average volume, even as the average volume increased. This observation indicates heightened market participation and interest. The consolidation phase witnessed a slight decline in volume as buyer and seller activity subsided temporarily. However, this period of consolidation created confidence to market participants, suggesting that there were insufficient sellers to drive Tesla's price back to the January 2023 lows near $101. Consequently, bullish investors stepped in, initially with low volume, but with increasing volume over subsequent weeks. Climax Volume and Recent Concerns In the beginning of June, Tesla experienced a second price mark-up phase characterized by a climax in volume. However, the most concerning factor is the lack of volume observed last week. While it's important to note that it was a short trading week, it remains the lowest volume seen since December 2022. The lowest all year. Even the Christmas week in 2022 witnessed higher volume. Last week was associated with a breakout to add to injury. Last week, Tesla achieved fresh highs for 2023, and a price target of $300-$305 is anticipated in the upcoming week or shortly thereafter. However, if volume fails to increase in the following week, it could signal potential instability, necessitating a thorough assessment of positions. Understanding Volume in a Mark-Up Phase In market cycles, volume serves as a critical indicator during the mark-up phase. During this period, when prices rise steadily, increasing volume signifies growing market participation and confirms the strength of the bullish trend. Robust volume suggests conviction among buyers and sellers, validating the upward momentum. However, a decline in volume, particularly after a climax or surge, can raise concerns as it may indicate diminishing participation or waning bullish sentiment. It is important to remain vigilant during such periods and conduct risk checks to protect positions. Educational Insights Volume analysis is a vital component of technical analysis, enabling investors to understand market sentiment and validate price movements. In a mark-up phase, increasing volume demonstrates conviction, signaling the sustainability of the upward trend. Conversely, declining volume after a surge or climax may warrant caution and risk assessment . Traders and investors should consider volume alongside other technical indicators to gain a comprehensive understanding of market dynamics and make informed decisions. Tesla's journey has seen significant turning points, including a capitulation bottom, which can be identified by analyzing volume patterns. The consolidation period and subsequent mark-up phase provided insights into market participation and sentiment. Volume serves as a valuable tool to confirm trends and assess the strength of a market cycle. However, recent concerns arise from the lack of volume in the past week, warranting cautious monitoring and risk evaluation. By incorporating volume analysis into investment strategies and understanding its significance, traders and investors can enhance their decision-making processes and navigate Tesla's dynamic market with greater confidence.
NASDAQ:TSLAShort
by bitdoctor
4
S&P500 I NOTICED A GOOD SELL AREAOn S&P500, we have a bullish setup with the price slightly retracing in the area around 4479 after touching highs at level 4645. Currently, there is an excellent reversal zone, a sell zone, at level 4525, where the price in H1 formed a strong supply level that had a significant impact on the price in the past week. In short, I'm waiting for a retracement to that level before entering a short position, aiming for a target around 4375, which corresponds to the previous major low. Let me know what you think. Have a great weekend! Nicola, CEO of Forex48 Trading Academy.
OANDA:SPX500USDLong
by Forex48_TradingAcademy
3
UPWK - emerging from base (buy the dips)UPWK has been forming a base with neckline around 14.50 -15.35. Upon earnings announcement yesterday, it gapped up decisively on huge volume, rising a crazy 44%, and closing right at neckline. What is clear is that it could be near the end of its base building and could begin to start trending up in the coming weeks. The entry is tricky now due to its oversized move in a single day, hence I would prefer to see some pullback from here to look for opportunity to enter at the dips (fib-retracement level, candlestick reversal setups etc) A more conservative approach is long only when it has cleared the neckline above 15.35. It may sound counter-intuitive to buy at hgher prices but in actual the odds of a sustainable trend is also increased when the stock is able to clear a significant resistence (namely, the neckline). Disclaimer: Just my 2 cents and not a trade advice. Kindly do your own due diligence and trade according to your own risk tolerance and don't forget that money management is (probably the most) important! Take care and Good Luck!
NASDAQ:UPWKLong
by Juliac
4
EUR/USD BEARISH SETUP WAITING NFPWe have a bearish setup on the Euro Dollar, with the price currently located around 1.0945, practically retesting a block that previously acted as support and is now serving as resistance. The objective will be to look for a short entry in the golden square I have highlighted, as that area aligns with the 50-61 Fibonacci levels. However, please be cautious as today we have the NFP (Non-Farm Payrolls) data release. Let me know what you think. Happy trading to everyone from Nicola, the CEO of Forex48 Trading Academy.
Short
by Forex48_TradingAcademy
1
GBP/CHF SHORT SETUP AFTER BOE NEWS I expect a strong Swiss Franc (CHF) against the British Pound (GBP) following recent events that have further weakened the US Dollar (USD). I anticipate a retracement to the 1.1130 level, where we have a Fibonacci retracement, and within that area, I will seek additional confirmation to enter a short position. Furthermore, after the interest rate hike in the UK and statements from the Bank of England's President, we have an additional motivational factor to short the British Pound (GBP). Please let me know your thoughts on this analysis. Happy trading to everyone from Nicola, the CEO of Forex48 Trading Academy.
Short
by Forex48_TradingAcademy
3
EUR/JPY BEARISH TRIANGLE AND LONG SETUPOn EURJPY, we can observe a descending triangle pattern, as the price generated a large bearish candle of over 80 pips around 9 o'clock on the H1 timeframe. Currently, the price is approaching a Forex48 block, which is a high reaction zone, especially if there's a double confirmation on the M15 timeframe. If this zone fails to halt the downtrend, the next potential target could be the level of 155.80, where we have a FVG (Financial Volume Grouping), indicating a significant support area. At this level, the price might find support and reverse upwards, targeting 157 to retest the lower boundary of the descending triangle. Your thoughts and analysis on this setup are welcomed. Happy trading to all!
Long
by Forex48_TradingAcademy
1
XAU/USD BEARISH SETUP - 1910 KEY LEVELOn gold, we have a bearish setup on both the weekly and daily charts. Occasionally, we have noticed that it is useful to look at clearer and more detailed timeframes. In both the weekly and daily charts, we precisely have a bearish setup with a resistance zone between 1960 and 2040. Within this zone, there is a demand area and a bearish trendline where the price has bounced before reversing course after a slight rally. Indeed, the price is now descending towards 1910, which is our key level that will act as support initially and then resistance once the price reaches the demand zone, which is between 1800 and 1840. We expect a rebound from that area with a target of 1910. Let us know what you think. Happy trading to everyone!
OANDA:XAUUSDShort
by Forex48_TradingAcademy
1
EUR/USD BULLISH SETUP WITH NEGATIVE ADP On EUR/USD, we have a bullish setup in the H4 timeframe. The price is currently within a range between 1.0980 and 1.0280. The expectation is for a bounce from the lower side of the range, around the 1.0980 area, where we have a trendline support, a Fibonacci retracement level (FVG), and a 50-period Exponential Moving Average (EMA) acting as support. This could trigger the beginning of a long trade with a target at 1.11. This scenario might be further influenced by today afternoon's anticipated negative data from the United States, which could lead to a depreciation of the dollar. Let me know your thoughts. Happy trading to everyone from Nicola, the CEO of Forex48 Trading Academy.
Long
by Forex48_TradingAcademy
1
EUR/USD LONG SETUP WAITING NFPOn EUR/USD, we have a bearish setup with the price approaching the 1.0996 zone, where we encounter a strong resistance/support area supported by a demand zone in the H4 timeframe and a bullish trendline. At this point, the price could potentially rebound, with a possible target at 1.15, considering that the dollar is expected to adopt an extremely restrictive policy in the coming months, while the Eurozone might raise interest rates to at least 5%. I would appreciate your thoughts on this analysis. Happy trading to all!
Long
by Forex48_TradingAcademy
1
GBP/USD SHORT TRADE AFTER THREE H1 RE-TESTI took a position in the GBP/USD market after noticing a confirmed downside breakout below the Point of Control (PoC) followed by 3 re-tests this morning. The price closed below the level of 1.2854, and I decided to enter a short position (sell) as I believed there were good chances for the price to continue going down. My objective (target) was to capitalize on further downside movements and profit from the decrease in the GBP/USD exchange rate. I made the trade based on what was highlighted on the chart, which indicated promising opportunities for a short trade.
Short
by Forex48_TradingAcademy
1