Volume

Volume is very useful in telling how strong the trend is moving. Trend moves like a river current, how strong the current depends on the forces behind pushing the current. That stronger the volume, the stronger the forces are pushing and forming the trend.

Downtrend

When you combine volume, candlestick chart and moving averages, it tells a lot of story.  Imagine, though the stock prices are moving up in low volume, then comes a sudden spike of high volume, that bring down the stock prices in which the red bearish candlestick breaks the moving averages. Then comes the downtrend. One good example below:

Chart courtesy of StockCharts.com

Uptrend

On the other hand, when most of the white bullish candlesticks are supported by stronger volume, and it stays above moving averages, occasional low volume of red bearish candlesticks failed to bring the stock into a downtrend. Another good example below:

Chart courtesy of StockCharts.com

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