5. Volume: The Force of the Market

“A Jedi’s strength flows from the force.”

—Yoda

Volume Is the Force

Although market volume is a crucial piece of investment information, the majority of the public is ignorant of volume. Financial analysts do not consider volume, whereas technical analysts underutilize it. This chapter discusses how volume provides essential information in two critical ways: by indicating a price change before it happens and by helping the technician interpret the meaning of a price change as it happens.

Volume Leads Price

Although practitioners of technical analysis and academia have often been at odds, volume information is one area where they tend to largely agree. Volume can provide essential information by indicating a ...

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