Forex Dictionary Terms


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Definition – What does Volume mean?

Volume is a measure of the total value of a market move. Volume is used to gauge the strength or weakness of a particular trend. If a trend is accompanied by high volume, it is seen as a sign that the trend will continue for some time. If a trend forms on weak volume, it is seen as a sign that the trend will likely falter because there is little or no trader interest.

ForexTerms explains Volume

Volume in the forex market is a tricky concept because there is no central trading exchange that keeps accurate numbers. In fact, because of the size of the forex market and the way it spans time zones, accurate volume figures would be old by the time they were reported. However, volume in the forex market can be estimated by counting the number of price changes in a session. A fluctuation up or down in price is considered equal to a volume of 1. Many fluctuations within a session means more volume. So, a trend formed on a day with 200 price fluctuations is considered stronger than a trend formed from 50 price fluctuations.

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