Volume can help us in confirming breakouts. Let’s examine how we can implement a proper volume trading strategy. First of all what we need is an indicator that gives us a better understanding of what the current volume levels tell us about the state of the market. To accomplish this we need an indicator that compares the current volume of a market to the relative values during the last couple of days.
We gonna show you something really interesting and when done correctly it can be exploited. We are talking about imbalances. You can basically do this with any time frame and any contract especially those with rising volatility and severe directional price changes for a prolonged period of time.