Re: What does increasing trading volume means to traders?
The high volume increases volatility, but you should also take a look at the OI as it affects the coin.
Most of the crypto has a fake volume, which means that market makers use their algorithms to provide liquidity to their clients.
You can use it as an indicator that coin is in the game, such volatility could be traded by bots like grids to take the big waves in the movement.
On the other hand, you could see an increasing volatility in a flat market that could give you a signal that coin will start pumping late.
For example, you see that we have a 500k volume then it increased to 1m and the market is flatting, this will give you a signal to future movement.
Start learning this in simple terms and don't overload your trading system.
Most of the crypto has a fake volume, which means that market makers use their algorithms to provide liquidity to their clients.
You can use it as an indicator that coin is in the game, such volatility could be traded by bots like grids to take the big waves in the movement.
On the other hand, you could see an increasing volatility in a flat market that could give you a signal that coin will start pumping late.
For example, you see that we have a 500k volume then it increased to 1m and the market is flatting, this will give you a signal to future movement.
Start learning this in simple terms and don't overload your trading system.