Volume: The Engine of Market Movement

Volume measures the total number of shares or contracts exchanged during a specific time period. In crypto markets, it represents the total number of coins or tokens traded within a given timeframe, typically displayed as vertical bars alongside price charts.

This fundamental indicator quantifies market participation and trading intensity. High volume indicates strong trader interest and conviction, while low volume suggests apathy or uncertainty. Volume doesn't measure price direction directly - it measures the magnitude of trading activity.

The indicator captures both buyer and seller activity, aggregating all completed trades regardless of direction. Each transaction contributes to volume totals, making it a pure measure of market turnover rather than sentiment or momentum.

Volume analysis reveals the underlying strength or weakness behind price movements. When prices rise on high volume, it suggests strong buying pressure. Conversely, rising prices on low volume may indicate weak conviction. The indicator serves as a confirmation tool for price trends and potential reversals.

In volatile crypto markets, volume patterns help distinguish between genuine trends and random price fluctuations. It measures market liquidity and the ease with which prices can move. Understanding what volume truly measures - raw trading activity - enables traders to make more informed decisions about market dynamics.