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Registered User
Joined: 10/7/2004
Posts: 2,126
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As I am quite aware of Sir Volume system, I have found a couple of discrepancy on the quick explanation of his system analysis.
Sir Volume said: **price sloping up and volume sloping down is bearisg - not completely true as a stock in a long term uptrend cannot keep an ever increasing volume therefore decreases in volume along an uptrend are expected and normal (an ever increasing volume would indicate a climax and that usually implies a inmediate retracement).
**price sloping down and volume sloping up is bullish - this is incorrect. A stock displaying a drop in price (sloping down) with increasing volume(sloping up) is a VERY BEARISH SIGN. There are many other combinations powerful in nature only if you understand what you are seeing. I will let you study and discover those on your own. I strongly agree with Sir Volume - this is a powerful tool.
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Registered User
Joined: 12/7/2004
Posts: 393
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Sir Volume's concept might work better if he uses On Balance Volume rather than Volume bars. 
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Registered User
Joined: 8/21/2005
Posts: 9
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I applied this formula to NVAX and it worked well as the price spiked to a new year's high; however, it has since given back 2 days of gains; yet this formula in price and volume, and balance of power suggest the stock is still a buy. How can that be when it has dropped almost 2 dollars in two days? Opinions/suggestions/explanations welcome!
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Registered User
Joined: 12/19/2004
Posts: 457
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QUOTE (laphill) Sir Volume's concept might work better if he uses On Balance Volume rather than Volume bars. <img src="/training/images/emoticons/smile024.gif"/>
I had actually used this for awhile. It still works, but I switched over to a Volume MACD, where daily, weekly volume is expressed as a percentage of the long term volume average.
Plot a moving average, plot bollinger bands, and you have a good overbought/oversold volume indicator.
It is easier to see divergences between price and volume this way. It is also easy to see breakouts on increasing volume.
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