Stocks & Investing

Volume

How many shares (or contracts) trade in a given period.

Volume is the fuel behind a move. High volume means lots of participation and conviction; low volume moves are easier to reverse. Traders watch for volume spikes to confirm breakouts and for the high-volume strike prices in an options chain, which show where the real interest is.

For example

A stock breaking to new highs on double its average volume is more convincing than the same move on light, holiday-thin volume.

Related terms

LiquidityMomentumOpen Interest

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