Volume
Total number of shares (or contracts) traded in a given period. Volume confirms price moves — no volume, no conviction.
Volume is the total number of shares, contracts, or units exchanged between buyers and sellers during a specified time period, typically a trading session.
Volume is one of the most important confirming indicators in technical analysis. A price breakout on high volume suggests genuine demand behind the move. A breakout on low volume is suspicious — it may reverse quickly.
Average daily volume (ADV) is a key liquidity metric. If a stock's ADV is 500,000 shares and you need to buy 50,000, you represent 10% of a day's flow — large enough to move the price against you.
Example
Stock XYZ breaks above a resistance level of $50. On the breakout day, volume is 3× the 20-day average — strong confirmation. A week later it tests $50 again on half the average volume, suggesting a weak retest rather than a breakout.
Related Terms
Bid Price
The highest price a buyer is willing to pay for a security right now. You sell at the bid.
BeginnerDay Trading
Opening and closing all positions within the same trading session — no overnight exposure. Requires focus, discipline, and strict risk management.
IntermediateExchange
An organized marketplace where buyers and sellers trade securities. NYSE and NASDAQ are the two largest US stock exchanges.
BeginnerLiquidity
How easily you can enter or exit a position without moving the price. High liquidity = tight spreads, deep order books, fast fills.
BeginnerPenny Stock
Stocks trading below $5 per share, often in tiny companies. Highly speculative, illiquid, and prone to manipulation.
BeginnerSpread
The gap between the bid and ask price. A tighter spread means lower transaction costs and better liquidity.
BeginnerTime and Sales
The chronological record of every executed trade in a security — price, size, and timestamp — also called reading the tape.
IntermediateVolatility
The degree of price variation over time. High volatility means bigger swings — more opportunity and more risk.
Intermediate