Volume Analysis

Discussion in 'Technical Analysis' started by melteye, Dec 7, 2003.

  1. melteye


    Does anyone have any good links to sites/papers on volume analysis?
  2. kowboy


    ET members Threei and ChrisT, have written a book describing the Price Volume relationships in "Techniques of Tape Reading" by Graifer and Schumacher. A good read and it has helped me considerably.
  3. gbennett


    "Trading on Volume"
    by Donald Cassidy

    is possibly the best book on volume.
  4. xs900


  5. Is this book primarily about daytrading? I do not pay much attention to volume as I have never found it to be any help on the short time frames but I may be missing something.
  6. kowboy


    Yes the book is primarily for intraday short term trades. I have been watching the volume more recently and it has helped me time the entries and exits better. Not a holy grail, but a helpful indicator.
  7. dbphoenix


    Yes, you are. Not that you can't trade without it, but I've never been able to understand why so many people would follow indicators about volume when they could just as easily follow the volume itself (and, by the way, be well ahead of everybody who's following volume indicators). I assume it's because they don't know how to interpret it.

    But if you don't have access to Wyckoff, the TTR book is excellent (I reviewed it here and at Amazon). Actually, it's excellent either way, as long as you don't get too wrapped up in the setups.
  8. Digs


    Volume is very important when Price is malking higher highs, or lower lows. Its the increase of volume that is important not so much the shape of the volume bars.

    Ie A price breakout with increase in volume may have better run up than a a price break out on light volume.

    Volume tells you when the fund managers have come out to play..
  9. mind


    on daily data on sp futures i did not find really significant things about volume. after calculating an exponential MA on volume and measuring where most recent volume was relative to that i looked at know highs or new lows and days with open and close being at extreme ends of the bar. those things that sound like common know how did not work out too well in my research.
  10. Mind:
    Good for you. What you have noticed is that people who comment on threads do not often do any research themselves. So what you are hearing is mythology. If fact, one useful item to keep track of (Intraday data only) is the number of contracts that go off at the bid vs at the offer. This is difficult to keep track of but is (in my opinion) worthwhile because it can show you the turning points on a chart. One way to get this data is to have a programmer make you a "counter" that keeps track of this data. For daily charts, I have found added value in using "On Balance Volume". Finally, those that comment on the nature of price movement with high or low volume are (most of the time) simply offering untested mythology. If one actually tests specific marikets, you will see a lot of different situations. In the most recent issue of Stocks & Commodities for instance, one of the articles talkes about the nature of price movement with up and down volume in the QQQ. Volume analysis can give you an edge if you pursue it intelligently. Good luck, Steve46
    #10     Jan 30, 2004