Volume Questions - from "Master the Markets"

[mr. jeff]

For my 2c I would have been out on the 2nd major up bar (blue) preferably at the top, and would then be waiting and watching for a break of this new region. Probably with a large degree of disinterest after having taken a large percentage gain.

If it broke out to the upside of the new level, I would re-enter, but as a fresh trade with less than a full quota at the entry, where I would wait for a further gain to confirm my entry and then hit it with further buying.

Hope this is clear. It may be less aggressive than some ( I like to lock in gains when any signs come - in this case this consolidation at the highs is clear enough for me to stand clear and wait) but it's always interesting to see other trading methods.


cheers.

 

[tech/a]

A smattering of Indecision,
1 reversal and a couple who think it will continue.

So here we are at resistance again.

Decision point.
What do you think?

CLICK TO EXPAND

 

[pavilion103]

Tech, it looked like price dipped on increasing volume and then has risen again on decreasing volume. I'm not sure if in this instance it is a bearish sign. I'd want to see increasing volume on any upmoves from here. I'd also be cautious around the high to see if heavy volume does come which could definitely be a buying climax.
I'm not 100% confident with this one. I'd be more on the bearish side I reckon. I'll take a stab and say that it will struggle to advance further.


Also Tech, I find it amusing how many people take offense to your comments. I love them. A number of comments have made me take a good hard look at my methods and hopefully become a better trader. None are personal, just to the point.

 

[Billyb]

A smattering of Indecision,
1 reversal and a couple who think it will continue.

So here we are at resistance again.

Decision point.
What do you think?

CLICK TO EXPAND

View attachment 44888

Is that a weekly chart? Certainly looks weak on the overall impression. From what I've seen that kind of price and volume action rarely leads to higher prices. Rare doesn't mean never..

 

[motorway]

Always keep in mind "The Technical Position"
consider how strong or weak are the hands that are holding

This tends to relate to the price that the holding was entered at.
Hence how far above or underwater everybody finds themselves

As a trend like this proceeds ,,, There are those who entered early sitting on more and more profits . There are those who entered later and significant number now who are only at break even or maybe even holding a loss ( Short side is another consideration ).

As the trend proceeds the hands necessarily go from being strong to weak
because those in profit close out positions . replaced by those buying in at the higher and higher prices and those who are showing LOSSES .

THERE IS A ROTATION ... Either Distribution and hence prices FALL
or a Re accumulation ...And this could be what is happening here.
Price could have dropped after the first test of the High
But it has gone back up .. WHY ? ( forget volume for a second )
BECAUSE DEMAND HAS OVERCOME SUPPLY

ok Why is volume LOW.... lack of demand ( where are the closes in the move up ? )

Or because the move down has flushed out available supply ?

If there is distribution (now ) why is there not heaver volume on the latest move Up ? EFFORT VS RESULT

I would be looking for a shallower retrace with even lower volume ( SPRINGBOARD )
Or Volume to increase as the move Immediately continues Up maybe gaping above Resistance..

If volume starts coming in and SUPPLY is SEEN to overcome demand
with ease ( ease of movement --- large ranges closing on the LOWS )
Then that will change the view ( there has to be EOM though )

THE LAST 5 BARS make a BULLISH CASE



Motorway

 

[Lone Wolf]

A smattering of Indecision,
1 reversal and a couple who think it will continue.

So here we are at resistance again.

Decision point.
What do you think?

CLICK TO EXPAND

View attachment 44888

I was thinking distribution. Then I read Motorway's post. He makes some excellent points. Certainly the recent few bars indicate a lack of supply for now. But I wouldn't expect a low volume move up to break though the previous resistance. How do I trade it? I wouldn't want to trade the breakout into possible supply as I don't see a good low risk place for a stop.

But as Motorway said, If we now get a low volume shallow pullback from the high, that would interest me.

 

[toocool]

As a trend like this proceeds ,,, There are those who entered early sitting on more and more profits . There are those who entered later and significant number now who are only at break even or maybe even holding a loss ( Short side is another consideration ).

BECAUSE DEMAND HAS OVERCOME SUPPLY

Or because the move down has flushed out available supply ?

Volume to increase as the move Immediately continues Up

THE LAST 5 BARS make a BULLISH CASE

Motorway

WOW ill go again, as before I would have been stopped out and not really knowing how far that pull back was but its still interesting set up.


I know you gave alot of questions there Motorway but I cut it to what I think has happened although I came to that only after reading your post.

If it does go through, it would be worth buying on the break as then its back to fresh air and only profit supply.

I also like how the last long range down bar sat on top of the previous resistance and moved away quickly.

 

[TECM]

A smattering of Indecision,
1 reversal and a couple who think it will continue.

So here we are at resistance again.

Decision point.
What do you think?

CLICK TO EXPAND

View attachment 44888

As I said - you have had it in for me from day 1 but tech/a this is not about us it is about the general good of the posters who want to learn.

If you want to run a test on any specific indicator then pay the posters the courtesy of being explicit about what chart and time frame you are trading. If you find it difficult to specify the chart then at least pay them the courtesy of speficying the time frame.

How are new comers to trading to learn when you only want to point score.

Anyone can be a smart alec when they post a chart which doesn't relate to any stock, index or any time frame. For all we know that could be a yearly chart.

I posted my analysis on a daily chart only to be castigated because it was subsequently revealed to be a weekly chart you were referring to but there was nothing to indicate the time frame to me or, so far as I can ascertain, anyone else.

If you are insisrtent on running a point scoring competiton then at least make our rules clear.

By my own admission I clearly admit that I did not make myself clear either and should have made it abundantly clear that I was working on a daily chart so Tech/a cannot be unnecessarily castigated for showing a weekly chart. We are both at fault.

So - the lesson is - if you want to make a random comment then specify the stock or index and the appropriate time frame you are referring to.

How can anyone make any proper or informative comment without the relevant bases being put forward. I am as as guilty as anyone else becaue of my assumption we were talking about daily charts.

I'm too time poor to be bothered making any further inuput.

All I can say is that I got an alert to go long at 4221 and with a trailing stop in place I'm up around $3,000.

I'm happy to see what I wake up with in the morning. A trailing stop will remain in place.

Sleep well.

E

 

[tech/a]

Heavens a one sided jibe here.
We are talking volume and spread analysis,
Where the high and at times resistance is
Playing a part.
There are some very good posts from people who have
Made observations based on the information they have
At hand.The setup occurs in all timeframes.

I along with many of the posters here will be both
Right and wrong and it's great to see that pretty well
All of them who have been incorrect have rules in place to
Mitigate risk.

Off for a bike ride in a howling gale so more later.

 

[mr. jeff]

Looks like a lot of stock changed hands at the retreat, but was supported by some big buys. Large range down bars bad, average volume has increased, then commenced move up to resistance overhead. Last bar relatively low volume up bar, weak buying or sellers dried up. Which one? Would suspect that the move will be a breakout as we haven't seen the profit taking near the highs that you could expect to see. This means I am calling it accumulation and then continuation of strength. Especially when noting the test with the green arrow underneath it, 14 bars back a sign of strength in the background.




Will be looking for a sign of strength to confirm this continuation on the move up.
If resistance holds, not good and looking for more information.

 

[tech/a]

Some terrific participation here as we move forward.
I have picked out those observations most pertinent to the current move.

From Motorway

THERE IS A ROTATION ... Either Distribution and hence prices FALL
or a Re accumulation ...And this could be what is happening here.
Price could have dropped after the first test of the High
But it has gone back up .. WHY ? ( forget volume for a second )
BECAUSE DEMAND HAS OVERCOME SUPPLY

ok Why is volume LOW.... lack of demand ( where are the closes in the move up ? )

Or because the move down has flushed out available supply ?

If there is distribution (now ) why is there not heaver volume on the latest move Up ? EFFORT VS RESULT

I would be looking for a shallower retrace with even lower volume ( SPRINGBOARD )
Or Volume to increase as the move Immediately continues Up maybe gaping above Resistance..

From Pav

I'd also be cautious around the high to see if heavy volume does come which could definitely be a buying climax.

From Jeff

Would suspect that the move will be a breakout as we haven't seen the profit taking near the highs that you could expect to see.

All great observations and accurate.

 

[tech/a]

And on we go.
Price doubles again to here!
Things are starting to get interesting.

Click to Expand

 

[tech/a]

So we are seeing Volatility for the first time since the start of the exercise.
also the high volume is appearing on a down bar finishing on the low.

 

[mr. jeff]

looks like there is some selling down now, a distribution.
Haven't had time to seriously think about it, it appears that the move is finding it has too many players, a lot less buying on the down days making wide ranging down bars.
Would definitely step aside now and watch.

 

[pavilion103]

So we are seeing Volatility for the first time since the start of the exercise.
also the high volume is appearing on a down bar finishing on the low.

You just beat me to it.
The first thing that came to mind was volatility is now apparent. This makes me think: be very cautious.

As for volume, let me have a think about it and I'll get back to you. Haven't had heaps of time recently and will be back on tonight if time permits.

 

[pavilion103]

Another observation is that even the significant volume bar is no where near the volume of the previous highlighted ones.
Is there enough demand to keep it going?

 

[motorway]

Another observation is that even the significant volume bar is no where near the volume of the previous highlighted ones.
Is there enough demand to keep it going?

Hey Pav .. what about the depth of the retracement this time.. ground given back !

Supply is seen to overcome supply

In an wyckoff sense ...Preliminary supply ....... RED FLAG

motorway

 

[tech/a]

Another observation is that even the significant volume bar is no where near the volume of the previous highlighted ones.
Is there enough demand to keep it going?

Excellent observation.
Interesting that the value of the shares traded in this bar is way way more than those traded in he previous very high volume bar.

 

[pavilion103]

I'm getting impatient for more chart!!!

 

[tech/a]

Sorry

Im having the Network upgraded here so my charts at work are not up so cant even trade---bugga.
Will have a look tonight or if they complete in time today.