Forex Trading Volume

By
www.ForexConspiracyReport.com
Forex Trading Volume

http://www.forexconspiracyreport.com/forex-
trading-volume/
A common harbinger of a change in
foreign currency rates is an increase in
Forex trading volume.

trading-volume/
Unlike with trading stocks on the NYSE
or NASDAQ a Forex trader does not
immediately see Forex Trading Volume.

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trading-volume/
This is because Forex trading takes
place around the globe.

trading-volume/
The major markets are not all open at
the same time but Forex trading
volume in London can give a clue as to
what will happen in New York and then
in Tokyo.

trading-volume/
Forex trading volume is largely a
technical cue and useful indicator of
changing market sentiment.

trading-volume/
Market Changes

trading-volume/
Many successful traders use Forex
trading volume as an indicator of the
strength of a trend or change in the
market.

trading-volume/
In a market that is trading sideways
there may be a sudden rise or fall in the
price of one currency versus another.

trading-volume/
If that move is accompanied by a
substantial increase in Forex trading
volume it is more likely that the trader is
seeing a new trend emerging.

trading-volume/
In case where Forex trading volume
does not really change as prices
change the implication is that the trader
is not seeing a new market trend and
that the market will soon correct itself.

trading-volume/
Used with other indicators of market
reversals such as the Doji signal in
candlestick trading, an increase in
Forex trading volume can help traders
make strong profits with a timely trade
or two.

trading-volume/
Just How Much Is
Enough?

trading-volume/
Just how much of a change in trading
volume is enough to indicate a change
in market direction?

trading-volume/
The issue for traders who use Forex
trading volume as an indicator of true
changes in market direction is just how
much do you need to see to trust the
indicator.

trading-volume/
The problem here for a trader is that if
he jumps too soon he may be following
a false lead and if he jumps too late he
may miss out on a trading opportunity.

trading-volume/
Obviously when Forex trading volume
doubles it is significant and when it
rises less than five percent it may not
mean much.

trading-volume/
A practical approach is to watch as
volume figures emerge, act upon
persistently rising volume and
reconsider when Forex trading volume
falls.

trading-volume/
Using Forex Trading
Volume to Confirm

trading-volume/
There are lots of trading strategies and
lots of trading signals. Many traders do
just fine without a lot of consideration of
Forex trading volume.

trading-volume/
When, for example, there is a Forex
response to violence in Ukraine it is
easy to assume that the Ruble will
suffer as well as perhaps the Euro.

trading-volume/
A trader may act upon the news of
events like the Russian annexation of
Crimea and use the subsequent
increase in Forex trading volume as
confirmation of his trade.

trading-volume/
Likewise, if he jumps into a trade and
sees a small profit only to see that
trading volume does not go up he may
choose to get out with his profit before
the rest of the market corrects.

trading-volume/
Because of the fast paced nature of
online Forex trading, the use of trading
volume as a backup indicator may be
its best use.

Forex Trading Volume

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Forex Trading Volume