What is the relationship between volume and market price?

Traders using volume believe that volume drives the market and ... without exception.

In order to understand why such a strong statement is, we have to study very carefully about market dynamics, a Trader needs to understand the basic structure of all markets and how it works. Because regardless of its type, the market always has a pretty similar property: moving in wavelengths. By studying the chart and the relationship between volume and price.

A basic map of the relationship between volume and market price


Why volume users are leading the market, because of the reasons you are seeing in the chart. If the selling volume continues to increase, the price will continue to decrease until the selling volume decreases and the increase in volume begins to appear. In the opposite case, as the volume increases continue to increase, the price also increases until the sale of volume appears.

Traders using volume can individually comment on the volume to see if the market is in an up or downtrend, which is entirely possible:
During a market uptrend, you will see the volume of buying deals leading the market, between areas where buying volume occurs in the area for the volume of sell deals with lower rates. On the contrary, the downtrend is similar.

Volume analysis of course has to come with price analysis, but in VPA (volume price analysis) you don't touch much candlestick patterns, it's only for-trade price action. You will use a few candlestick patterns, usually, the two main patterns are the outside bar and inside the bar. But for now, for the next part, this series is very long and ensures the quality of those who like to learn about VPA school.