#6 Volume (What It Really Shows)

---

What Is Volume?​

Volume shows how many contracts or shares were actually traded.

In simple words:

• Volume shows real activity
• It shows what already happened, not what might happen

Volume only increases when:

• A buyer and a seller agree on a price
• A trade is executed

---

What Volume Does NOT Show​

This is very important for beginners.

Volume does not show:

• Pending orders
• Orders waiting in the DOM
• Intentions

That is the job of the Order Book (DOM).

---

Volume vs Market Depth​

• Market Depth = orders waiting (intent)
• Volume = orders traded (action)

Example:

• 1,000 contracts on the bid (depth)
• Only 100 contracts traded (volume)

This means:

• Many orders were waiting
• Few trades actually happened

---

High Volume vs Low Volume​

High Volume

• Strong participation
• Many buyers and sellers active
• Confirms interest at that price

Low Volume

• Weak participation
• Few trades
• Price can move easily

---

Volume and Price Movement​

• Price can move with low volume in thin markets
• Price can stall even with high volume in deep markets

So:

• High volume does not always mean big movement
• Low volume does not always mean weak movement

Context matters.

---

Beginner Tip​

Volume answers one simple question:
“Did traders actually trade here?”

It does not tell you:

• Who will win next
• Where price will go

---

 

#5 Market Depth

#7 Volume at Price