If in the real estate world the age-old adage is "location, location, location" the one for equity and futures traders should be "volume, volume, volume." I'm often flabbergasted to see that many of these supposedly advanced and "PRO" trading platforms don't make a simple volume chart more prominent. They all advertise all sorts of gimmicks and technical indicators, all sorts of meaningless chart overlays, stochastic, moving averages and so forth. For 99% of all people trading, that's garbage and noise on their screen. Let volume and price movement tell you the story of that stock. Very often you'll find prices "float" up or down in price with relative low volume and this is when a lot of people get burned. In general low volume equals no-no to make decisions. With low volume, price is left at the mercy of high-power speculators who, for instance, can short a stock enough for the price to go considerably down and taking people's stop-loss in the process. On a high volume setting this sort of manipulation, although plausible, is highly unlikely. Volume is also a confirmation of trend: is the stock "normally" fluctuating or is it going down for a good reason. On heavy volume, if a stock/contract going up or down on heavy volume 9/10 times that sets the "tone" of that stock or contract for the rest of the day. More importantly, when that happens, as a trader you need to either jump in that tend or get out of the way. The easiest and most basic to lose money is to either stand in the way or trying to "outsmart" a heavy-volume trend. So, unless you are in that small 1% of day traders that make a living off shaving a penny or two per share, you are better off using your brokerage real-time (streaming is preferable) chart and volume rather than spending hundreds of dollars on "PRO" trading platforms that will be of little or no use to you.
Cannot emphasize this concept enough: volume, volume, volume. And when in doubt, yes, look at volume. And right before making a trade, look at volume. And after the trade? You got it, look at volume.
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