Trading volume is a measure of how much of a given financial asset has traded in a period of time.
For stocks, volume is measured in the number of shares traded and, for futures and options, it is based on how many contracts have changed hands. The numbers, and other indicators that use volume data, are often provided with online charts.
Looking at volume patterns over time can help get a sense of the strength or conviction behind advances and declines in specific stocks and entire markets. The same is true for options traders, as trading volume is an indicator of an options current interest. In fact, volume plays an important role in technical analysis and features prominently among some key technical indicators. Volume measures the number of shares traded in a stock or algo trading software for nse contracts traded in futures or options. Volume can algo trading be software for nse an indicator of market strength, as rising markets on increasing volume are typically viewed as strong and healthy. When prices fall on increasing volume, the trend is gathering strength to the downside. When prices reach new highs (or no lows) on decreasing volume, watch out; a reversal might be taking shape.
Algo trading software for nse Trying.On algo trading software for nse Balance Volume and Klinger Indicator are examples of charting tools that are based on volume. When analyzing volume, there are usually guidelines used to determine the strength or weakness of a move. As traders, we are more inclined to join strong moves and take no part in moves that show weakness—or we may even watch for an entry in the opposite direction of a weak move.
These guidelines do not hold true in all situations, but they offer general guidance for trading decisions. Buyers require increasing numbers and increasing enthusiasm in order to keep pushing prices higher. Increasing price and decreasing volume might suggest a lack of interest, and this is a warning of a potential reversal. This can be hard to wrap your mind around, but the simple fact is that a price drop (or rise) on little volume is not a strong signal.
A price drop (or rise) on large volume is a stronger signal that something in the stock has fundamentally changed. In a rising or falling market, we can algo see trading software for nse exhaustion moves. These are generally sharp moves in price combined with a sharp increase in algo trading software for nse volume, which signals the potential end of a trend. Participants who waited and are afraid algo trading software for nse of missing more of the move pile in at market tops, exhausting the number of algo trading software for nse buyers.
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Volume should be looked at relative to recent history. Comparing today to volume 50 years ago might provide irrelevant data. The more recent the data sets, the algo trading software for more nse relevant they are likely to be.
Algo trading software for nse The world have.Volume is often viewed as an indicator of liquidity, as stocks or markets with the forex trading system for daily charts most volume are the most liquid and considered the best for short-term trading; there are many buyers and sellers ready to trade at various prices. Volume indicators are robotic trading software mathematical formulas that are visually represented in most commonly used charting algo for nse software trading platforms. Each indicator uses a slightly different formula, and traders should find the indicator that for algo software trading nse works best for their particular market approach. Indicators are not required, but they can aid in the trading decision process. There are many volume indicators to choose from, and the following provides a sampling of how several of them can be used.
On Balance Volume (OBV) OBV is a simple but effective indicator.