Using Indicators for Buy And Sell Signals.

One Stock Market Indicator that i use very much along side my Stock Charts is the Trading Volume. The Trading Volume is the number of shares bought and sold in a day. The way i use the trading volume indicator is to watch for when there is an exceptional high volume (at least twice the average normal volume).

A high volume day is usually a reversal signal, meaning that the share price should change direction. For example when the share has been dropping as shown in the graph above and you notice a volume bar at least twice as big as usual you would expect the Share Price to change direction and go up the next day. But i do not recommend that you use this indicator in isolation (do not enter a buy position simply because there was a volume surge) but rather that it be used as one of the tools in your tool box as a Stock Trader. However in my experience i have observed that majority of the time this phenomenon comes true as it is one of the major stock market indicator being watched by other traders and this makes it almost self fulfilling.