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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: daryll40 who wrote (39690)	11/15/2000 5:03:18 PM
From: Sun Tzu	Respond to of 70976

Here's some explanation: For stocks in trading range or slow trends, volume tends to precede the price movement. So if you've had a dead stock for a while and slowly you see the volume increase on it. That indicates that more and more people are warming up to it, even if the price does not go anywhere. Likewise, when the stock is going up (or more often staying up) but the volume is shrinking, chances are the stock is about to nose dive. Again, these cases are for stocks in trading ranges, which does not apply here. For stocks in strong trends (up or down), the norm is for volume to follow price. So if the stock is going up, you want to see increasing volume. If it's going down, you want to see shrinking volume. Now here's where it gets tricky, a very high volume in a strong trend, often indicates an end of that trend (up or down). Here is a chart to look at stockcharts.com[W,A]DECLYYMY[PB50!B200!D20,2!F][VC60][IUP14,3,3!LA9,27,9!LF] The very bottom indicator is one of my favorite volume indicators. Notice how it confirms the price movements early in the year, but signals the impending fall and subsequently does not confirm any of the bounces. You may want to adjust it just for the last 6 months to get a better picture. In short, AMAT reversing trend in high volume is a good thing. ST