Trading & Technical Analysis

What is a trading volume indicator and why does it matter?

A trading volume indicator measures how many units of an asset change hands over a period, showing the strength of participation behind a price move. Volume matters because a move backed by high volume reflects broad conviction, while one on thin volume may not hold. For example, a breakout above resistance on rising volume is generally read as more durable than the same breakout on weak volume. Volume is a confirming signal rather than a forecast, so it works best alongside price structure and other indicators rather than as a standalone trigger.

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