Volume

Volume is on every chart you have ever looked at. It is also the one thing nobody can tell you how to use.

You were taught the rules. Heavy volume confirms a move. Light volume warns you the move is a fake. A spike marks the bottom. Several heavy selling days mean a large holder is getting out, so sell. A breakout without volume is a trap.

You have probably never been shown a single number behind any of it.

This book counts them. Fifteen things traders are taught about volume were written down as exact rules before anything was measured, then run across 3,399 American stocks and 8.9 million trading days, including more than 1,600 companies that failed or were bought out and no longer appear in anyone's data.

Five of the fifteen held up. Four held up but are far smaller than you have been told. Six were contradicted outright.

Which five, and which six, is the book.

What you will find out:

• Whether a volume spike really marks the low - and the one extra test that changes the answer more than the spike does
• What heavy volume actually buys you, which is not what the textbook promises and is more useful than what it promises
• Why the most repeated rule about falling stocks is backwards, and what that means if you are holding one
• Whether "accumulation" and "distribution" predict anything at all
• Which of the two ways traders state the oldest rule in the subject is the one worth watching, because they are not the same rule and only one of them works
• Why a headline result that beats the market by three points in three months should not be trusted, and how to spot the same trick in other trading books

What you will be able to do:

• Read any volume bar as a multiple, so you can tell heavy from light on a chart you have never seen, without an indicator
• Know which breakouts to trust, and what to do about the ones you should not
• Stop selling into the signal that is taught as a top and is not one
• Handle a stock making new lows using the finding most likely to change what you do tomorrow
• Stop counting distribution days in a single stock, and know why
• Work through six steps on any chart, in order, with no arithmetic in them - the whole routine fits on one page

Written to be used, not just read. Part I teaches the fifteen claims the way a believer would state them, with no testing and no spoilers. Part II counts every one. Part III turns the findings into decisions. Every claim is numbered, and a single table gives the verdict on each one and the chapter holding the evidence - so you can look up the rule you already believe and go straight to the answer.

Plain English, written for easy understanding. No equations, no jargon you have not already met, and every term defined where it is used and again in the glossary. Twenty charts and diagrams, drawn from real market history, make every idea easy to see.

Whether you have just noticed the bars under the chart or you have traded on volume for years and never fully understood it, this book tells you which rules survive counting - and which ones have been costing you.

Part of the Reading the Chart Series. For educational purposes only; not financial advice.