Volume by itself is never indicative of a short squeezes, volume follows price so if there is weakness in bar(candle) close, this is a hint of two things, profit taking and a possible? (exhaustion/directional change)? (but for firmer directional change or short squeeze confirmation) this involves more information, one of them would be where are your indicators located? I like using trifectas, three signals together is way more powerful than just one or two, FYI, If you look at the $SPY, we almost hit 70,
That is simple equation but does it say anything but define a transaction? The issue in volume would be does quantity matter? Seems not if you look at some stocks. When sellers aren't there. Price can rise fast. And far. Doesn't need large quantity of volume. Just one buyer, one seller, right. And then another buyer. Can't find a seller. At his price. What happens? If buyer wants it bad enough. He finds seller who will sell but at much higher price. Two transactions total. But price now higher. No. I think price is what matters.
You are 100% right. Let's say you're a whale, or working for such, trading the ES on any given slow overnight session with unlimited funds. You have access to data that retail doesn't. (These numbers are purely to illustrate a point): You (in reality its AI) see that the retail players for whatever reason are selling short. You let the price get pushed down to the ideal level as determined by your data feeds and the AI processing such, and commence buying every sell order. You accumulate 100,000 contracts at price X, but you also know that there are 300,000 contracts short, retail players that all have stops set. You let things calm down as the night progresses. Soon the sell orders are minimal according to your feeds, and your algys know the exact moment when the price can be run up substantially with the absolute minimal amount of contracts being purchased. So in the matter of minutes you buy an additional 30K contracts moving the price up to the level where most stops are set. You have 130K contracts, but there's 300K that start covering their short positions. You have basically bought for X, but you now dump those at a level higher than your cost as buyers cover their shorts. Buy one, sell two. I wrote this years ago here. @Buy1Sell2 is no dummy... he may not be a whale lol, but his selection of that monikor says it all because that is exactly what goes on nightly. Sometimes for pennies, sometimes for more. Sometimes in minutes, sometimes in hours. I made it generic as possible, but that's what goes on. You get the idea. Powerful algorithms with unlimited funds and unlimited data... establish a position and then they buy one, then sell two. Obviously, it works the other way too. Its all math, and their programs/data are about a trillion times smarter and quicker than all ya'll combined. No ones out to get you, its just a machine that makes money. But there's more than one machine... and as such, you have a fighting chance as the whales battle each other, IF you understand what I just wrote and hawk it as best you can through your (somewhat) fogged window. -vz
Now, if I had been on a 10 times leveraged position, I would have been much more inclined to cover, and it would have been all out. However, I am on a 2 times leveraged position, so I can let it play out.
B1S2, I respectfully ask you to STFU about bearish movement. Become a permabull, man. Bears are all negative and poopoo on the economy, and on life. Bulls, however, see light and life and fun in the futures! Why drive into hell, when you can float to heaven! Be positive, not negative! Positive vibes, man!
It is proven as volume increases so does range of price. That is not the same as direction. Prices can and do move higher and/or lower on both/either increasing and decreasing volume. Now we've crossed into what is a trend, which is off topic for this discussion and thread. >> Can't find a seller. At his price. What happens? If buyer wants it bad enough. >> He finds seller who will sell but at much higher price. And then what happens? What does that volume at a much higher price produce? Volume leads price. If you don't yer meat, you can't have any pudding. How can you have any pudding if you don't yer meat? ~Pink Floyd
You are missing a verb there. If you don't EAT yer meat, you can't have any pudding. How can you have any pudding if you don't EAT yer meat? ~Pink Floyd