Is it discending price + discending volume bullish?

lucacrebbe

Trader
Jun 26, 2017
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Hi, sometimes I have red about this: ''discending price + discending is volume bullish''
is that true? What is your tought about it?
(I am talking about stocks, not forex)
 

Enivid

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Nov 30, 2008
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There is some logic behind such a notion. Declining volume suggests that less and less trades are executed at the descending price, which might signal that bears are "getting tired". However, I don't think that "descending price + declining volume" can serve as a reliable BUY signal alone on its own. You would need some confirmation and other signals to get a high probability trade.
 

lucacrebbe

Trader
Jun 26, 2017
73
0
22
39
There is some logic behind such a notion. Declining volume suggests that less and less trades are executed at the descending price, which might signal that bears are "getting tired".
but it could also be there are less buyers

However, I don't think that "descending price + declining volume" can serve as a reliable BUY signal alone on its own. You would need some confirmation and other signals to get a high probability trade.
for example from which indicator?
 

Enivid

Administrator
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Nov 30, 2008
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but it could also be there are less buyers
Yes, declining price always means that there are less buyers than sellers at a higher price, but combined with a declining volume, it suggests that this seller/buyer disparity is probably shrinking.

for example from which indicator?
Any. It could be fundamental, sentimental, or any technical indicator. The descending volume/price combination just gives you a small clue to what could be probably going on. You can use everything else to dig it up further.
 

momo3HC

Active Trader
Feb 16, 2019
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Hi, sometimes I have red about this: ''discending price + discending is volume bullish''
is that true? What is your tought about it?
(I am talking about stocks, not forex)
Definitely can`t be used as a single reason for entering Long. For an example check the last BTC big drop situation.