Cryptocurrency Basics | Six Types of Trading Volume
📍1. Surge:
Trading volume significantly increases compared to a previous period, usually appearing at turning points of stocks or trends, indicating active market participation and growing divergence between bulls and bears.
📍2. Contraction:
The market experiences light trading, with most participants in agreement about future market outlook. Contraction can sometimes help to rebuild new upward momentum.
📍3. Record Volume:
The maximum trading volume observed over a period. Appearing at the bottom may signal a turning point, while at the top it may indicate a peak signal.
📍4. Floor Volume:
- Usually appears as the lowest trading volume generated after a continuous decline in stocks or a prolonged sideways phase at the bottom, indicating weak trading interest and a high probability of a turning point.
📍5. Accumulation:
Trading volume bars continuously rising, resembling steps. If it appears in a lower price area, it may signal future price increases; in a higher price area, it may indicate risk.
📍6. Sawtooth Volume:
Occurs without sudden positive news and in a stable market, with irregular trading volume and large discrepancies between highs and lows, often indicating that market makers are luring retail investors to take over positions.
