What is Stock Trading Volume?
Stock trading volume is the number of units that change hands of any given stock for any given time period. On a daily stock chart, each volume bar represents the number of shares traded each day. On a weekly chart every volume bar represents the number of shares traded each week. Below is a daily chart of Icos Corporation (ICOS). Fig 3.5 Click to Enlarge. On the bottom of the chart is the stock trading volume. Each bar represents the number of shares traded each day. Green bars happen on up days and red bars happen on down days. ● How to Read Stock Trading Volume There’s a saying that goes, “volume precedes price.” Essentially that means significant volume activity can predict price movement. It’s up to you to decide how true that is. At any rate, what constitutes a significant volume activity? A good place to start is the average volume. Once you figure out a stock’s average volume, you can tell if a given day’s volume is significantly above or below that average. Certain chart progr
