10. Volume – the crowd behind the move
Volume is the number of shares traded in a period. If 5 lakh shares changed hands today, today’s volume is 5 lakh. On most charts it appears as bars at the bottom.
Price tells you what happened. Volume tells you how many people cared.
A baraat passes through your lane. If only four people are dancing, nobody notices and it ends quickly. If 300 people are dancing with a band and a horse, the whole street stops, and it goes on for hours.
A price move with low volume is the four-person baraat. A move with big volume is the full procession – much more likely to keep going.
10.1 The four combinations
| Price | Volume | What it suggests |
|---|---|---|
| Up | Up | Strong buying. The rise has support. |
| Up | Down | Rise with fewer participants. May be running out of fuel. |
| Down | Up | Strong selling. The fall has conviction. |
| Down | Down | Selling is drying up. The fall may be slowing. |
10.2 Practical ways to use volume
- Confirm breakouts. A breakout on 2–3 times average volume is much more believable.
- Spot climaxes. A huge volume spike after a long move can mark exhaustion – everyone who wanted to buy (or sell) has done it.
- Healthy pullbacks. In an uptrend, volume should be lower on pullbacks than on up-moves. If pullbacks come with heavy volume, sellers are getting stronger.
Many charting platforms let you add a moving average of volume (for example 20-day). It makes "above normal" and "below normal" volume easy to see.
Volume ko kabhi ignore mat karo, especially in small caps. A small cap jumping 8% on tiny volume can be moved by just a few players – and fall just as fast. Ask always: kitne log is move ke saath hain?
High volume shows many participants and big money behind the move.
Low-volume pullbacks show sellers are not aggressive. That is a healthy uptrend.
- Volume is the number of shares traded – it shows participation.
- Price up + volume up is strong. Price up + volume down is weakening.
- Use volume to confirm breakouts and spot climaxes.
- In healthy uptrends, volume is higher on up-moves than on pullbacks.
- Ek line mein: Price batata hai kya hua, volume batata hai kitne logon ko fark pada – bina volume ke move pe bharosa kam karo.