Volume

[Iron]

If the market is trading in a narrow range, and there is a sudden surge in volume, does that indicate that a breakout may be imminent?

Thanks

Jeff

[Mug]

Trading volumes spikes is a useful strategy, but often it spikes quickly and you have to sit there for a few seconds to figure out if it is genuine or not.

[Bet Angel]

A couple from yesterday for you.

100413 - 1740 - Volume spike.png

100413 - 1925 - Volume spike.png

[Iron]

Thanks

BTW, I believe it used to be the case that a spike would typically be followed by an immediate retracement, whereas now it seems more likely to signal the start of the trend.

Why do you think this is?

Jeff

A couple from yesterday for you.

100413 - 1740 - Volume spike.png

100413 - 1925 - Volume spike.png

[Bet Angel]

It depends, if the price is stable then a there is an huge outsized order in the market you would expect it to retrace. If the market is stable or slightly trending and the order hits the market then it is likely to kick off a trend. Probably due to the all the people will open position that need to close and / or people who fear losing the current price.