monday musings, page-21

Hi newsboy, the software that produced those charts is homegrown :) However, many commercial packages display the cumulative volume histograms - I also use Interactive Brokers' Trader Workstation which has this feature. However, it doesn't display beyond two weeks volume. However, I sometimes go beyond that with my own software depending on what recent volume I deem relevant. e.g. on Friday, pretty much all the volume that was laid down since we were last below 90c is relevant i.e. trapped punters above wanting out :), which is why I chose to display 13 days.

The way I like to use the cumulative volume is to determine intraday turning points and I think it works best in situations such as this morning where loads of volume goes through at a particular price (over 10 million shares went through at $1 today), then the share price moves a significant distance away from the high volume zone, so you end up with loads of regretful buyers or sellers in the high volume zone which will cause a bounce when this zone is revisited. You can pretty much guarantee the price will bounce at $1 if it gets back there today.