📘 How to Understand Volume in Crypto – Clear Steps for Beginners & Pros
Volume is one of the most important indicators in crypto trading. It reveals market strength, whale activity, trend confirmation, and the truth behind every move.
Many traders focus only on price, but ignoring volume means you're looking at the chart without sound.
In this article, you’ll learn how to read volume step-by-step in a simple, practical way you can teach to your followers.
🔎 What Is Volume?
Volume is the number of coins traded (bought or sold) within a specific time period.
High volume = strong activity, whales entering or exiting
Low volume = weak movement, no serious interest
🧭 Step 1: Look at the Volume Bars
Below the price chart, you’ll find the volume bars.
Tall bar = big activity (whales, institutions, or large orders)
Short bar = weak activity (market waiting, low interest)
✔ Rising bars = upcoming strong movement
✘ Falling bars = weak or fake movement
🟩 Step 2: Understand Green vs Red Volume
Green volume = buy pressure
Red volume = sell pressure
But the size of the bar is what really matters.
Examples:
🔹 Small green bar → weak buying
🔹 Large green bar → strong whale buying
🔹 Large red bar → heavy selling / possible dump
🔹 Small red bar → normal correction
📈 Step 3: Compare Volume With Price (Price Action)
This is the secret behind professional trading.
🔥 Golden Rule:
Strong movement without volume = fake or weak move.
Strong movement with volume = real and reliable move.
Examples:
✔ Price rising + strong volume
Healthy breakout or start of an uptrend.
✘ Price rising + weak volume
Trick move or liquidity grab.
✔ Price dropping + strong volume
Panic sell or major distribution — often followed by big opportunities.
✔ Price dropping + low volume
Healthy correction.
🧩 Step 4: Watch for “Volume Spikes”
A Volume Spike means a sudden large bar that is bigger than the previous 3–5 bars.
This indicates:
Whales buying aggressively (if green)
Whales selling aggressively (if red)
Volume spikes often signal the beginning of a major move.
🧨 Step 5: Use Volume to Confirm Breakouts
If price breaks a key resistance level (example: SOL breaking $142.5) but volume is weak:
➡️ This is a Fakeout.
If the breakout happens with:
✔ Big green volume bar
✔ Strong candle
✔ Stable movement above resistance
➡️ This is a True Breakout.
Volume is your confirmation.
🛑 Step 6: Don’t Use Volume Alone
Volume is powerful, but it must be combined with:
Support & resistance
Candlestick patterns
Trend lines
Liquidity zones
Whale activity
Market structure
When these align with volume → your entries become much stronger and safer.
🎯 Final Summary
To read volume correctly:
Watch the size of volume bars
Understand buy vs sell pressure
Combine volume with price movement
Look for spikes to detect whale activity
Use volume to confirm breakouts
Combine volume with other indicators
With these steps, you'll be able to identify:
Where whales are entering
Where traps are forming
Whether a move is real or fake
The beginning of strong trends
When to avoid risky entries
