So I'm completely new and just want to read and learn as much as possible.
Investopedia's page on volume says
Volume can be very useful in identifying bullish signs. For example, imagine volume increases on a price decline and then the price moves higher, followed by a move back lower. If the price on the move back lower stays higher than the previous low and volume is diminished on the second decline, then this is usually interpreted as a bullish sign.
If I'm reading that right:
More people are buying while the stock goes down a bit and then goes up more. Then fewer people are buying when the stock goes down an even smaller amount, so that volume has now decreased and the price is higher on the second decrease compared to the first.
Why is that an indication of a stock being bullish though? Is it just a noticed statistical trend or is there a logical reason in expectation that I'm not thinking of?
Submitted July 18, 2018 at 05:51AM by benaugustine https://ift.tt/2L6EqKu
