xjo weekend zoomba lounge, page-98

Ok guys...thanks for the read,always a delight.

Volume....the subject of this weekends Zoomba and my thoughts.

1....for those of you wish to look back to the 2009 April lows,for the DOW,you will find that it ADVANCED in value on LOWERING VOLUMES,relative to the LOW.

2....Likewise the climb out of the July 2010 lows was also on LOW volumes,relative to the high April 2010 volumes including the 'fat-finger' crash.

3....An interesting observation is that the average daily volumes have been INCREASING over the last few years.This is generally put down to lower transaction costs and the introduction of higher frequency trading with smaller order sizes(Algorithmic trading or Bots) as well as the INCREASED participation of DIY investors('mums and dads')

4....Volume levels in general are now back at 2003-2006 levels,before the increase in market volatility and subsequent crash.

Now,although this subject is certainly more complex than a quick explanation here,I have a theory.......and it is:Could it be that with the gains being made in the market at the moment are greater than what could be achieved by using Computer generated Algorithmic trading and so profits are being allowed to run(one of the first rules of trading).In other words the bots have been switched OFF!

Now what I am saying is that may not be the WHOLE story,but I suspect their is an element of truth to it.I am not sure how to analyse this from the data,as I suspect others don't know how to either.

For further reading,and for Redbacka,here: http://www.erim.eur.nl/portal/page/portal/ERIM/Content_Area/Documents/whyhastradingvolumeincreased.pdf


What I wonder is: Has Wyckoff and others taken into account NEW trading methods ie BOTS.