Here is a step -by -step guide on how to analyze the volume of trading in terms of market trends:
Step 1: Choose a time frame
. Popular options include:
- Daily (1-day, 5-day or 30-day chart)
- Weekly (1-week, 2-week or 4-week lists)
- Monthly (3-month, 6-month or 12-fed charts)
Step 2: Identify market trends
Understand the market trend. Common trends include:
- Stubborn (rush up)
- Bearish (rush down)
- Related to range
- Average reverse
Step 3: Analyze the Volume of Trading
Get a trade volume from a reliable source, such as:
- API exchange
- EOD (end of the day) data channels
- Market data providers such as Alpha Vantage or Yahoo Finance
Choose a time frame and a market trend you chose in step 1.
Step 4: Calculate the average movable
Calculate the average movable to identify the shoot. Popular options include:
- Simple movable average (SMA)
- Interpretation average movable (EMA)
- Relative force indicator (RSI)
Use data from step 3 and calculate the removal matters using the following formulas:
- SMA = (weighted average price x Close) / total volume
EMA = ((weighted average closing price x) + (average open price x) / (2 total volume)
- RSI = 100 – (100 / (1 + rs))
Step 5: Analyze the volume -related indicators
Identify the volume -related indicators to help identify market trends. Popular options include:
- In the volume of balance sheet (area): calculate the difference between buying and selling a volume
- Battling/distribution line (ADLI): indicates when the supplies are purchased or sold out
- Balance volume indicator (OBI): weighted sum of the OBV line for a given period of time
Step 6: Visual loudness trends
Use volume trends. Popular options include:
- Software for charts such as TradingView, Thinhororswim or Ninjatrader
- Time series charts with volumes
Indicators related to volume and other trend lines on the chart.
Step 7: Make a conscious commercial decisions
. Consider factors such as MP:
- Trends related to volume (e.g. increasing OBV or ADLI levels)
- Medium movable crossover
- RSI levels
Connect these factors with other technical and basic analysis tools to inform about your commercial decisions.
By following these steps, you can analyze the volume of trading in terms of market trends and make decisions regarding information trading.