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XDORZ
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How to use volume-price analysis to determine support and resistance?
How to use volume-price analysis to determine support and resistance?
Here, we review and analyze Bitcoin's price movements over these few days, as shown in the figure with图文 explanations.
I. Determining the stability of support
After a sharp drop, prices usually test the bottom multiple times until the bearish momentum weakens. At this point, observing changes in trading volume through volume-price analysis can help determine whether the price has stabilized at support or trend lines.
II. Quantitative methods for trading volume analysis
When current trading volume exceeds 1.5 times the average volume of the past 20 candlesticks, or shows a gradually increasing trend, it can be considered as increased volume, indicating a possible strong breakout or reversal in the market.
Here, we review and analyze Bitcoin's price movements over these few days, as shown in the figure with图文 explanations.
I. Determining the stability of support
After a sharp drop, prices usually test the bottom multiple times until the bearish momentum weakens. At this point, observing changes in trading volume through volume-price analysis can help determine whether the price has stabilized at support or trend lines.
II. Quantitative methods for trading volume analysis
When current trading volume exceeds 1.5 times the average volume of the past 20 candlesticks, or shows a gradually increasing trend, it can be considered as increased volume, indicating a possible strong breakout or reversal in the market.
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