Is it discending price + discending volume bullish?

Discussion in 'Newbie Questions' started by lucacrebbe, May 17, 2019.

  1. lucacrebbe

    lucacrebbe Trader

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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)
     
  2. Enivid

    Enivid Administrator Staff Member

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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.
     
  3. lucacrebbe

    lucacrebbe Trader

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    but it could also be there are less buyers

    for example from which indicator?
     
  4. Enivid

    Enivid Administrator Staff Member

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    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.

    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.
     

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