The chances for a significant breakout or breakdown is enhanced by
achieving around 50% of the average daily volume in the first hour of trading
for the trend of your position.
In
another respect, if prices have been rising up to noon and the volume is only
about 25% of the average daily volume, it is a signal that demand (buying) is
drying up. When the volume dries up on
the buying (new highs on lower than average volume due to lack of demand), it
is the signal for a reversal in the Bull trend; as prices seep downward, it
will eventually trigger the stops of the Bulls creating a domino effect downward. Likewise, if prices have been declining up to
noon and the volume is only about 25% of the average daily volume, it is a
signal that supply (selling) is drying up.
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