Volume is a measure of how much stock or how many contracts (if options) or barrels (if oil) are traded in a given day, week, month or quarter. Changes in volume traded can signal a change in price trend and relative strength either up or down. A marked shift in average daily volume alongside an increasing or decreasing price trend is a signal that should be carefully assessed as part of any trading strategy whether short, mid or long term.

Some volume trends worth noting include:-

It is important not to rely on one tool or signal alone but rather use multiple signals to assess changes in trend. Purists who rely only on technical analysis believe that changesin price is the ultimate indicator or truth of a companies or markets prospects as perceived by the majority. Investors who use fundamental analysis do not concern themselves much with technical analysis as they believe if the market fundamentals and management are strong, it will grow as will its profits and inevitably the share price will appreciate. Another subsector of investors will use both fundamental and technical analysis in their decision making.

Popular volume signals and oscillators include the Chaikin Money Flow and Klinger Oscillator.