Problem with all this volume analysis is that it assumes that the low volume is due to lack of buyers. But if that was the case then prices would be falling wouldn't they. .....the basic laws of supply and demand? Low volume rallies mean one thing and one thing only. NO SELLERS=NO SUPPLY. Prices will rise until it brings in supply to meet the demand..
How high will prices have to rise to entice the sellers and create the supply? Will it be 7 years and 1400% like in the INTC example above? Your guess is as good as mine........... I'm just riding the trend.
For many reasons I do not step into the middle of this sort of discussion but this time I am going to. The quote above has been edited by me to read less in "attack mode" but the basic theme is the same.
Several times I and others have pointed out that rising prices on low volume is often due to supply. YES over time no buyers are willing to pay up and price will start to fall. The key here is TIME over which price and volume is occurring. Are you day trading or position trading or even buy and hold till death do us part.
From my point of view this is important for traders to understand the real affect between volume and price relationship.
There are posters here who use volume short term very effectively and there are some who use it for long term. Me, I rarely use volume, but watch volume AFTER price movement.
My last point is this started out as a good intellectual discussion, but IMO egos got in the way and "I'm right-you are wrong" became the rule.
This board is all about sharing ideas and methods, with good sound logic and charts if needed.
I doubt if any of us know all we need to know about volume and its TRUE usefulness. I would like to see this subject started over with proper debate.
mss
GREAT POST kisacik WISH I HAD SEEN IT BEFORE I POSTED.
THANKS, mss
