Negative volume balance

Negative volume balance is a sign of weakness. It shows that the stock falls on high volume and reacts upwards on low volume. This indicates that investors are worried about not being able to sell when something happens, and also hesitant to buy on rising prices.

Volume balance is a very important indicator. It is often used alongside trend analysis and other indicators based on the stock price.

The following applies to negative volume balance:

• Strengthens a sell signal
• Weakens a buy signal
• Indicates that investors are negative and falling prices will continue
• Indicates the end of rising prices and a trend reversal downward

Negative volume balance warns of uncertainty among investors and high risk in a rising phase. Negative volume balance also confirms falling trends and sell signals in a falling phase.