Both volume balance and the correlation between price development and volume development are positive. This indicates that buyers are aggressive and strong, while sellers are hesitant.
Both volume balance and correlation between price and volume development are considered important indicators. They are often used alongside trend analysis and other indicators based on the stock price.
When both of these are positive at the same time, it is a strong signal of increasing optimism among investors. Volume will often trigger signals early – even before the increasing optimism triggers rising prices.
The following applies when volume development is positive:
Generally we want to see positive volume development for stocks we own or will buy. Positive volume indicates a healthy stock with a positive development of the investors’ view of the stock. Such a stock is indicated to continue rising.
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The content provided by Investtech.com is NOT SEC or FSA regulated and is therefore not intended for US or UK consumers.
Investtech guarantees neither the entirety nor accuracy of the analyses. Any consequent exposure related to the advice / signals which emerge in the analyses is completely and entirely at the investors own expense and risk. Investtech is not responsible for any loss, either directly or indirectly, which arises as a result of the use of Investtechs analyses. Details of any arising conflicts of interest will always appear in the investment recommendations. Further information about Investtechs analyses can be found here disclaimer.
The content provided by Investtech.com is NOT SEC or FSA regulated and is therefore not intended for US or UK consumers.