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Why does the transaction volume of the rising currency shrink during the callback process, and it is best to shrink it to the transaction volume before the band starts, which means that it has fallen to the bottom and is about to rebound?
It can be understood as follows: the transaction volume is an indicator of the activity of currency trading. Usually before the pull-up starts (before the dealer enters), the daily transaction volume can be regarded as the buying and selling volume between retail investors only, usually fluctuating around a "fixed value".
The transaction volume suddenly increased. On a certain day, the transaction volume was significantly enlarged, several times the "fixed value", and the currency price rose sharply. In addition to the stimulation of strong good news, it is usually the dealer who enters with huge funds to raise the currency price in a short period of time.
Attract retail investors to chase high. Next, the daily transaction volume is getting bigger and bigger, and the currency price is climbing at the same time.
Here comes the key point: the dealer smashes the market. The dealer starts to smash the market, and the main purpose is to induce retail investors who chase high to cut their losses (clear floating chips). At this time, the daily transaction volume changes from large to small, from small to large, or alternates between large and small, and the price of the currency continues to fall.
How to judge whether the retail investors (floating chips) chasing high prices have been cleared? When the transaction volume returns to the "fixed value" before the pull-up is launched, it means that the excess floating chips (retail investors chasing high prices) have basically been cleared, and the dealer has absorbed enough chips from retail investors to cut their losses before continuing the next wave of pull-ups.
Therefore, it is an objective and highly operational method to measure whether the currency price will continue to fall by comparing the daily transaction volume with the transaction volume before the launch during the callback period.
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