When High Volume happen. Analyzing Lagre Large Volume and it's physiology
Often we can see Large Volume at a given price level or given time frame. We examining below.Correctly Analyzing and Identifying both types of trading activities will help you more in trading.
Large Volume take place in two way. We classified it on the basis of the Number of Traders.
1 . Single Trader with Large Volume - One or two or a few traders Bidding Large Quantities at a given price level.
2 . Multiple Players have same Conviction - Few or more institutional or smart money, who trade with huge volume, will have same conviction that may be the Price may rise or down at a given price level or given time.Sudden rise/down in price without any opposite move is the impact of this.
3. Tuff War Between Multiple Traders (Buyers and Sellers) - A ruff Bar Between Buyers and Sellers. there will be large number of Buyers and sellers trading with large quantity
In which types of situation or When large volume take place
Where large volume take place in a Chart or Chart Pattern
We know that there are 3 types of Price movement. Uptrend, Down trend, Sideways Market. Price Moves Higher High and Higher Low in an up trending market Vice Versa in Down Trending Market. Price Moves in between a Range in sideways Market.
At Support in Uptrend and Resistance in Downtrend- In an Up trending market(HH HL Pattern), Previous Higher High and Last Low(Higher Low) act as Support area (If Last HL Breaks, trend will change). generally price will restart its upside movement from the first support area(Last HH) which will be the end of corrective move and the start of impulsive move. But, if price moved to the second support area (Last Low, HL) the current trend is in jeopardy. So in the Last Low support area, traders may have both conviction and uncertainty. so large volume trading activity shall happen there. Smart money buying shares at these. The vice versa in downtrend.
In Sideways Market - In a sideways Market, generally volume will be low in any sideways market because the price does not have trend. Even though, there will be high volume trading activities at Resistance level and Support level in a sideways Market
At the end of Trend and Start of Trend - large Volume Trading Activity take place at the start and the end of a trend. Accumulation of stock by smart money at the start of a bull trend and Distribution of stock by the smart money at the end of an Uptrend and Vice versa.
Stopping Volume - Stopping Volume is a type High Volume activity that stop a price move or price trend. Suppose the price is trending down, means all traders are in selling mode. suddenly large volume of buying happening that prevent price to go further down move. It is know as Stopping Volume which sometimes may cause for trend change
Candlestick Types in Large Volume
1 . Single Trader with Large Volume - Generally A single trader huge volume only result small price movement.In below picture, First two have small body with no wick which means a smart traders who have an assumption that the price may rise/down bought/sold huge volume of an equity share at a given price level.
The Next two picture have no body with small wick. generally a big trader who bought/sold share at lower level of the wick that caused the price move to it's starting point.
This shall not affect the current price movement. because it is not a strong price movement. it will not overcome the opposite side buy/sell pressure.It is only a big trade of a single trader.
2. Multiple Smart Traders have same and strong conviction - This types of big candle create when many traders have same and strong conviction that price may rise or down.
Suppose if smart traders start buy huge volume of shares, the price will defeat all other selling pressure and move higher. So this is a one side price move with huge volume that overcome all pressure against the move. means this types of price move can change the current trend, boost the current trend, start a new trend. Means it can influence the price movement.
These candles have higher reliability in higher time fame.
Tuff War Between Buyers and Sellers - This candlestick types generally known as Doji candle.It indicate an indecision exist among traders. Many Traders are buying and many are selling large volume of shares create indecision moment in the market. This types of candles activity can influence the price trend.
Sometimes it may be a stopping volume. some large traders are buying huge volume while others are selling create this type of candle. This activity shall stop or weaken prevailing trend at least for a while.
At the time of accumulation and distribution, this types of candles are very common at that time. Smart money accumulating shares while armatures are selling at bottom level or a price chart. And vice versa in Uptrend.
These candles have higher reliability in higher time fame.
How The Large Volume Effect the Price Movement
We learned that there are two occasion large volume trading take place. one is A Single Trader Buy/Sell Large Volume. Another is large number of traders Buy/Sell Large Volume of shares.
Single Trader with Large Volume - In Trading, It is a war between buyers and sellers or demand and supply. There are thousands of traders actively involving in trading activity with millions of shares. A large volume accumulation/distribution of a single trader is just a trade of a single man among thousands of traders. It is only a single trader,s view, expectation, conviction of that stock. a single trader's assessment or expectation of a stock will not influence in further price movement.
Large Volume Trading from many people defensively influence the further price movement. Because, a large number of trades have same view on a stock and Buying/Selling stock based on that expectation can lead the market to their way.
In Simple, A single trader can not move a stock to his way but a more number of people same together can lead or move the market on their way. ie. Support 1000 traders are actively Involving in a stock's trading. Just 1 trader among 1000 trader but large number of shares. It is only a one trader's view on the stock. At the same time 100 trader among 1000 trader bought large number of shares will influence price movment.
- How many method (types) Large Volume take Place
- In which types of situation large volume happen
- Where large volume in a chart happen
- Candlestick types in both types of large volume
- Decoding Physiology of volume in in different market time. First 5, 15, 45 minute and Last 30 Minute, Between 11:00 to 3:00 pm
- How The Large Volume Effect the Price Movement.
Large Volume take place in two way. We classified it on the basis of the Number of Traders.
1 . Single Trader with Large Volume - One or two or a few traders Bidding Large Quantities at a given price level.
2 . Multiple Players have same Conviction - Few or more institutional or smart money, who trade with huge volume, will have same conviction that may be the Price may rise or down at a given price level or given time.Sudden rise/down in price without any opposite move is the impact of this.
3. Tuff War Between Multiple Traders (Buyers and Sellers) - A ruff Bar Between Buyers and Sellers. there will be large number of Buyers and sellers trading with large quantity
In which types of situation or When large volume take place
- Any Major News and Corporate Announcement may be the cause of large Volume
- First 5, 15 and Last 15 minute of trading hours
- Large Volume take place while Accumulation and Distribution(Profit booking) by Smart Money (FII, DII, Mutual Funds...etc.)
- Large Volume take place in the Support and Resistance area
Where large volume take place in a Chart or Chart Pattern
We know that there are 3 types of Price movement. Uptrend, Down trend, Sideways Market. Price Moves Higher High and Higher Low in an up trending market Vice Versa in Down Trending Market. Price Moves in between a Range in sideways Market.
At Support in Uptrend and Resistance in Downtrend- In an Up trending market(HH HL Pattern), Previous Higher High and Last Low(Higher Low) act as Support area (If Last HL Breaks, trend will change). generally price will restart its upside movement from the first support area(Last HH) which will be the end of corrective move and the start of impulsive move. But, if price moved to the second support area (Last Low, HL) the current trend is in jeopardy. So in the Last Low support area, traders may have both conviction and uncertainty. so large volume trading activity shall happen there. Smart money buying shares at these. The vice versa in downtrend.
In Sideways Market - In a sideways Market, generally volume will be low in any sideways market because the price does not have trend. Even though, there will be high volume trading activities at Resistance level and Support level in a sideways Market
At the end of Trend and Start of Trend - large Volume Trading Activity take place at the start and the end of a trend. Accumulation of stock by smart money at the start of a bull trend and Distribution of stock by the smart money at the end of an Uptrend and Vice versa.
Stopping Volume - Stopping Volume is a type High Volume activity that stop a price move or price trend. Suppose the price is trending down, means all traders are in selling mode. suddenly large volume of buying happening that prevent price to go further down move. It is know as Stopping Volume which sometimes may cause for trend change
Candlestick Types in Large Volume
The Next two picture have no body with small wick. generally a big trader who bought/sold share at lower level of the wick that caused the price move to it's starting point.
This shall not affect the current price movement. because it is not a strong price movement. it will not overcome the opposite side buy/sell pressure.It is only a big trade of a single trader.
2. Multiple Smart Traders have same and strong conviction - This types of big candle create when many traders have same and strong conviction that price may rise or down.
Suppose if smart traders start buy huge volume of shares, the price will defeat all other selling pressure and move higher. So this is a one side price move with huge volume that overcome all pressure against the move. means this types of price move can change the current trend, boost the current trend, start a new trend. Means it can influence the price movement.
These candles have higher reliability in higher time fame.
Sometimes it may be a stopping volume. some large traders are buying huge volume while others are selling create this type of candle. This activity shall stop or weaken prevailing trend at least for a while.
At the time of accumulation and distribution, this types of candles are very common at that time. Smart money accumulating shares while armatures are selling at bottom level or a price chart. And vice versa in Uptrend.
These candles have higher reliability in higher time fame.
How The Large Volume Effect the Price Movement
We learned that there are two occasion large volume trading take place. one is A Single Trader Buy/Sell Large Volume. Another is large number of traders Buy/Sell Large Volume of shares.
Single Trader with Large Volume - In Trading, It is a war between buyers and sellers or demand and supply. There are thousands of traders actively involving in trading activity with millions of shares. A large volume accumulation/distribution of a single trader is just a trade of a single man among thousands of traders. It is only a single trader,s view, expectation, conviction of that stock. a single trader's assessment or expectation of a stock will not influence in further price movement.
Large Volume Trading from many people defensively influence the further price movement. Because, a large number of trades have same view on a stock and Buying/Selling stock based on that expectation can lead the market to their way.
In Simple, A single trader can not move a stock to his way but a more number of people same together can lead or move the market on their way. ie. Support 1000 traders are actively Involving in a stock's trading. Just 1 trader among 1000 trader but large number of shares. It is only a one trader's view on the stock. At the same time 100 trader among 1000 trader bought large number of shares will influence price movment.
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