How To Analyze Trading Volume For Market Trends

Here is a step by step to analyze the amount of market trends:

Step 1: Select program

Select the schedule you want to analyze. The popular options are:

• Diary (one day, 5 days or 30 days of graphics)

• Weekly (1 week, 2 weeks or 4 weekly graphics)

• Monthly (3 months, 6 months or 12 months of paintings)

Step 2: Identify market trees

Understand the market trend. The general trends are:

• Rising (ascending rhythm)

• A descending (descending rhythm)

• At a tied distance

• Average return

Step 3: Analyze the amount of trade

Obtain information from negotiated quantity of a reliable source such as:

• Replace application subscriptions

• EOD (end of the day) Data Feed

• Market information suppliers such as Alpha vandage or Yahoo Finance

Choose the schedule and market trend that selected in step 1.

Step 4: Calculate the mobile average

Calculate mobile averages to identify the rhythm. The popular options are:

• Simple sliding average (SMA)

• Exponential Sliding Media (EMA)

• Relative Force Index (RSI)

Use step 3 data and calculate mobile averages with the following formulas:

• Sma = (weighted average closing price) / total volume

Ema = (Weighted Media of the price x weighted) + (open price x weighted average)) / (2 total volume)

• RSI = 100 – (100 / (1 + rs))

Step 5: Analyze the indicators related to volume

Identify the number of indicators that help identify market development. The popular options are:

• In balance (obvious): Calculate the difference between purchasing and sales volumes

• Accumulation/distribution line (ADLI): Indicates when a warehouse is being overloaded

• Balance volume index (OBI): The weighted sum of OBV lines for a specific period

Step 6: visualize volume trends

Use visualization tools to analyze volume trends. The popular options are:

• MAPEO SOFTWARE AS TRADINGView, THINKTORSWIM O NINJATRDER

• Time series with volume information diagrams

The diagram visualizes mobile averages, volume indicators and other trend lines.

Step 7: Make conscious commercial decisions

Use your analysis to make commercial decisions based on information. Let’s see factors such as:

• Trends associated with volume (for example, increasing obv or adli levels)

• Average cross exchanges move

• RSI levels

Combine these factors with other technical and basic analysis tools of your commercial decisions.

Following these steps, you can analyze the amount of market trade in market trends and make conscious negotiation decisions.

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