Price rising with decreasing volume suggests:

Potential reversal/weak move. Price/volume divergence (rising price, falling volume) often precedes reversals.

Volume Analysis

Confirming moves with market participation

Volume is the number of units traded in a given period. It confirms or denies price movements.

Key principles: - Rising price + rising volume = strong trend (confirmed) - Rising price + falling volume = weak move (potential reversal) - Volume spikes at support/resistance = institutional activity - Breakouts need volume confirmation to be valid

Volume Profile shows volume at each price level, revealing where most trading occurred (Point of Control) and value areas.

Pro tip: Never trust a breakout without volume. Low-volume breakouts are almost always fakeouts..

Common mistake: Ignoring volume and only looking at price. Better: Volume reveals the conviction behind price moves — always check it.

Key takeaways

Volume confirms price moves
Price/volume divergence warns of reversals
Breakouts need volume confirmation
Volume spikes indicate institutional activity

Quiz

Price rising with decreasing volume suggests: Answer: Potential reversal/weak move. Price/volume divergence (rising price, falling volume) often precedes reversals.

Educational content, not financial advice.