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Fire Your Stock Analyst!: Analyzing Stocks on Your Own by Harry Domash

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Trading Volume

Trading volume is usually plotted at the bottom of a price chart. Volume is the number of shares traded during the period. A stock is said to have high volume if the current level is at least 50 percent higher than the volume over the past 10 or 20 periods. A stock is said to have low volume when the volume looks like it’s petering out.

Many charting experts consider volume an important consideration when a stock starts a new uptrend after consolidating. New uptrends on low volume are considered more likely to fail than those accompanied by high volume. In general, increasing volume is considered a bullish factor during uptrends.

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