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Strategies & Market Trends : Technical Analysis - Beginners
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To: bdog who wrote (9541)2/24/1999 5:00:00 PM
From: Richard Estes  Read Replies (1) of 12039
 
But I suggest you look at a chart, the buys come on a contraction of price and volume. The sells come on an expansion of both. Breakouts should expect an increase in volume but not super highs or it can come back on you just as fast.

Why buy on contraction of price and volume? You have run out of sellers and buyers, it has to go up or down. Lines placed at the 2 week max high and lows determine breakout points. Remember real volume has a tie to float or shares avail.

A volume number is relative to float. a Stock with 100M float trading 1M shares, moves 1% of float. A stock with 10M float and volume of 1M, turns 10%!

So we should look at volume, but price rules. And when you look, have the right perspective.

Wisdom is the ability to see things in perspective.
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