There is a famous saying in the stock market: Trading volume does not lie! Therefore, when trading stocks, it is very important to look at trading volume. Generally speaking, it is a good thing if the price rises and the volume increases, and the price and volume are appropriate, but the opposite is bad. At the bottom stage of a stock, trading volume increases moderately and the center of gravity of the stock price gradually moves upward. It is often the case that institutions are gradually collecting chips. After the chips are collected, the stock price also rises to a certain extent. Institutions often have to launder the chips and the stock price falls. To determine whether to launder funds or ship goods, it mainly depends on whether the trading volume is shrinking or increasing. A decrease in volume means shipments, and a decrease in volume means a washout. However, when looking at rising or falling prices, it is not enough to look at trading volume alone. If there is no takeover of falling shipments, even if the trading volume shrinks, it cannot be said that the institution has no intention of shipping. If the general trend is not bad, institutions can shock shipments. If the trading volume continues to increase, it is also possible that retail investors are chasing too much, and institutions are slowly shipping. Even if institutions ship, there may be new institutions stepping in to push the stock price higher. Therefore, trading volume is very important, and you cannot just look at the trading volume indicator. Fundamentals must be combined and hot spots and the general environment must be considered. If only trading volume could determine the rise or fall, stock trading would be too simple.

In addition to looking at the length of the volume pillar, looking at the volume ratio is the way most people look at the trading volume. The volume ratio is the ratio of the average trading volume per minute on the current day to the average trading volume per minute of the previous 5 days. If the volume ratio is less than 1, it means that the trading volume has shrunk; if the volume ratio is greater than 1, it means that the trading volume has increased.