📘 How to Understand Volume in Cryptocurrencies – Clear Steps for Beginners and Professionals
Volume is considered one of the most important indicators that show us the strength of movement, market intent, and whale activity. Many traders rely solely on the chart, but ignoring volume means you're seeing 'the picture without sound.'
In this article, I will explain to you how to read volume step by step in a simple way.
🔎 What is volume?
Volume is the number of coins that have been bought or sold in a certain time period.
High volume = Entry of large funds
Low volume = Movement without strength
🧭 Step 1: Monitor the size of the bars (Volume Bars)
In every chart, you will find volume bars below the price.
Long bar = Large trading (whale activity - entry or exit)
Short bar = Weak trading (calm market - no decision)
✔ Rising bars = Strong movement coming
✘ Falling bars = Weak movement or deception
🟩 Step 2: Learn the difference between green volume and red volume
Green = Buying
Red = Selling
But be careful:
The color alone is not enough. The size of the bar must also be considered.
Example:
🔹 Small green bar = Weak buying
🔹 Huge green bar = Whale entry
🔹 Huge red bar = Strong distribution
🔹 Small red bar = Natural selling
📈 Step 3: Compare volume with price (Price Action)
This is where the professionalism begins.
🔥 Important rule:
Strong movement without volume = Deception and liquidity trap.
Strong movement with volume = A real movement that can be relied upon.
Simple examples:
✔ Rise + High Volume
Beginning of an upward trend.
✘ Rise + Weak Volume
High probability of price return or upward trap.
✔ Decline + High Volume
Strong liquidation or panic — whales may enter afterwards.
✔ Decline + Low Volume
Natural correction and not a collapse.
🧩 Step 4: Always look for 'Spike Volume' (sudden jumps)
If you suddenly see a huge volume bar larger than 3–5 bars before it:
This means one of two things:
Whales have entered buying strongly (if the bar is green)
Whales sold a large quantity (if the bar is red)
These moments are often followed by a significant movement within hours or days.
🧨 Step 5: Make sure to verify breakouts using volume
If the price breaks a significant resistance (like $142 in SOL)
But without strong volume:
➡️ This is a false breakout
However, if the breakout is with:
✔ Long volume bar
✔ Strong candle
✔ Stable movement above resistance
➡️ This is a real breakout
🛑 Step 6: Do not rely on volume alone
Volume is the strongest tool, but it is not enough on its own.
Use it with:
Support and resistance lines
The trend
The candles
Whale areas
Breaking patterns
When the tools agree → the decision becomes stronger.
🎯 Summary
To understand volume correctly:
Monitor the size of the bars
Understand the difference between buying/selling
Link volume to price
Pay attention to volume jumps
Ensure the validity of the breakouts
Combine volume with the rest of the analysis
By applying these steps, you will be able to know:
Where whales enter
Where the market makes traps
Where the real movement begins
When to avoid entering
