Indicators and strategies
We'll explore how trade volume might enhance several technical indicators and trading tactics in this last section, giving you a more sophisticated approach.
Volume-based technical indicators- Volume is taken into account by indicators like Chaikin Money Flow and On-Balance Volume (OBV) to produce trading signals that are more accurate. These are especially helpful when trading bitcoins, as their prices frequently fluctuate suddenly.
Volume and price action- In order to validate price action signals, volume can also be used. When a bullish candlestick pattern, such a "Hammer," is combined with a high trading volume, it is typically regarded as a stronger buy signal.
Average volume- You can learn more about the typical behavior of the asset by comparing the current volume to an average. If you see that a token such as VERSE has a much higher volume now than it did previously, this could indicate a great trading opportunity.