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Using BB On Volume To Determine Tops/Bottoms

March 21st, 2013
in contributors, syndication

by Jeff Pierce, Zentrader

On Friday the volume on the Nasdaq exceeded the upper Bollinger Band (BB) that I’ve plotted on the volume section of the chart. I also noticed a large number of stocks on my volume scans that seem indicative of an index re-balancing, but keep in mind I don’t watch the news, so I’m not sure if that is really the reason. I’ve just noticed this in the past.

Follow up:

Anyhow, this is not an indicator to use on it’s own, but it’s something to take not of. Lots of volume with little or no movement in the actual index is worrisome. My timing signals remain on a buy signal except for the TSX which is in neutral mode at the moment. Take a look at the 2nd chart below for a weekly look at the Nasdaq to really add some clarity to this new way of using the bollinger band in conjunction with volume.

If you find my technical analysis and outlook on the markets useful you may want to check out my personal trading service at tradewithZEN.com for more information. Here you’ll find testimonials, past trades, and trading performance. I’ll be accepting members up to 100 and then closing the doors.

 









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