Volume

Volume represents the total number of shares or contracts that change hands during a specific timeframe and is a key indicator of market activity and liquidity. High volume confirms price movements and suggests strong conviction, while low volume may indicate weak moves prone to reversal. Volume precedes price is a common principle—unusual volume often signals impending moves. Volume analysis includes studying volume patterns, comparing to averages, and using indicators like OBV or Volume Profile. Breakouts with high volume are more reliable. Volume varies by time of day, with highest activity at open and close.