Wednesday, May 16th, 2012

Negative Volume Divergence

Tuesday, March 9, 2010 at 6:30 am

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When price rises, but volume falls, it is called a negative volume divergence and non-confirmation price action. This is bearish. In addition, we should see large bursts of volume accompany periods of declining volume (these are your optimal trading days). Traders should be cautious from this point on.

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Comments

42 Responses to “Negative Volume Divergence”
  1. I’d sell the general stock market now and start buying gold and silver dollar coins.

  2. mhass33 says:

    I noticed this EXACT same thing last night as I was reading trader Vic

    “The relation of Volume to Price movements: A market which has been overbought becomes dull on rallies and develops activity on declines: conversely, when a market is oversold, the tendency is to become dull on declines and active on rallies. Bull markets terminate in a period of ecxessive activity and begin with comparatively light transactions.”

  3. pissant says:

    MSN showing signs of needing a correction, short at 4.65

  4. goon says:

    CA,

    What you make of this action in FEED? sort of been flagging all morning right above its 200 day MA; volume is huge; trying to see if it can break this intraday flag

  5. TA says:

    2009 was all about that and yet we went higher.

    We did the exact same thing in July

  6. pissant says:

    BOOO YAHHHH! covered MSN at 4.209, 9.5% gain

    • mhass33 says:

      that was sick dude… fell off a cliff right after you said

      • pissant says:

        It’s all about the setups…

        Look for extended stocks that are above the bollinger band, and have huge volume.

        Next, wait for the high to be put into place, and consolidate at lower levels, short as it breaks down.

        I was early at 4.65 and had to wait for over an hour… if you waited for 4.55 you wouldnt have had to wait at all.

        Think about all the common sense areas where stop orders might be placed by retail investors… for MSN it was 4.50, 4.40, 4.33 (y’day close) and 4.25… i just covered after the 4.25 stops were triggered.

  7. momoboy says:

    AEN needs to get over 1.00$…

    discl: long

  8. Sold final 1/4 $AIG 30.16

  9. Sold final 1/4 $AIG 30.62

  10. Sold $AIG 31.00 limit

  11. Sold final 1/4 $AIG 32.80

  12. Bought small $AIG 33.03

  13. Sold other 1/2 $AIG 34.42

  14. Tonight’s Charts Gone Wild, I will explain the $AIG trade in detail.

  15. pdf says:

    russell – iwm – already above jan hi swing vs. spy’s

    screaming divergence/levitation – fire torepodes

  16. the Bull says:

    Can’t wait CA, I took a look the second you bought it, wasn’t impressed by the set up and passed. I’m a douche. :(

  17. bears have thrown in the towel, couple that with the volume divergence highlighted in the charts here – a massive down day with massive volume could happen at any time

  18. dcook says:

    Hi CA, do you need any interns?

  19. dcook says:

    CA, you said in the past that you have students..do you mean you give classes? if so how does one signup to become your student as I’m very interested … Is there any chatroom that you participate in that you recommend.. Thank You

  20. mhass33 says:

    Son of a bitch I have a to work til midnight… gonna have to watch the show on archive

    We need streaming stocktwits to blackberry technology…

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