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Online Share Trading

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Salv
Frequent Contributor
is it fair to say that the volume that is traded on a particular day indicates how strong the price move on that day was. For example 16% odd down on AGL on friday was backed by a good 3 bil in volume traded. My logic says that this is therefore a significant price shift, that wont easily be regained. If my above logic is correct, what indicators are available to do a price to volume comparison? Thx
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12 REPLIES 12
Not applicable
yes ...volume is far far too often ignored... the market never like to show its hand but with volume it flashes its hand inadvertently giving u a good look at the hand....u will see the idiots always attribute far too much to low volume days...
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SimonPB
Valued Contributor
volume is important .. the opposite is a move on small volume doesn't inspire confidence ..
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Not applicable
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Salv
Frequent Contributor
I see, so when trying to take volume into account is it just a matter of having an understanding of what the average volume for a particular share is, and the then just doing a comparison of the volume versus that average to identify if it is a strong or weak price move? Or is there a specific indicator, such as RSI ROm ect that uses a formula to give u an idication?
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Not applicable
Alexander Elder has something called a force indicator which combines price and volume and is very useful IMHO.
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Electrox
Super Contributor
Vitorc, How do u find the best way to use the Force index when trading? DO you use the [2] or [13]? thx
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Salv
Frequent Contributor
Were could i get this indicator from, ive tride doing it myself in excel but the volume data that i download of OST has commas in it which means i cant use it in excel formulas :/
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nala
Super Contributor
what is IMHO?
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Not applicable
Use Find & Replace to remove the commas, then format the cells as numbers...On the OST charts there is an indicator called OBV (on balance volume)see this link for an explanation...http://stockcharts.com/school/doku.php?id=chart_school:technical_indicators:on_balance_volume..hope this helps
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Theater_Cat
Super Contributor
Do you possible know which software incorprated FORCE INDEX indicator?
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Not applicable
IMHO - In my honest opnion. Amibroker & Metastock have a scripting language built-in. So you can write/download these indicators. I have downloaded the Amibroker script for force indicator.
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Not applicable
Its one of a couple of indicators I use. Its the last one I look at and I use it as confirmation. When it moves steeply/strongly towards zero I trade in that direction.
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