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CHAPTER 6: Technical Analysis, Any price anomalies are quickly found out…

- - - - It is a pure supply and demand analysis for common stocks. The higher the volume, the more active is the security.
      - Volume is the total number of shares traded during a given period.
      - * Strong market happens when volume goes up.
      - * Weak market happens when volume goes down.
      - Normally shown in the bar found at the bottom of a stock chart.
      - Volume can be used to determine the strength of a trend, or confirm the movement of the price.
  - - - :pencil2: A technical analysis theory that predicts the strength of the market according to the number of stocks that advance or decline in a particular trading day.
      - :pencil2: Looks at number of stock prices that go up (advances) versus number of stock prices that go down (declines)
      - :pencil2: If the breadth indicator is strong, this theory predicts that the market will be rising and vice versa.
      - :pencil2: Strong market when advances are more than declines.
      - :pencil2: Weak market when declines are more than advances.
  - - - :star: Measure market sentiment and predict market trends.
      - :star: Contrary opinion is the opposite opinion of the sentiment held by the majority. It is based on the idea that when the vast majority of people agree on anything, they are usually wrong.
      - :star: Small traders are believed to be wrong in the market timing.
      - :star: So, it is assumed that small traders will do just the opposite of what should be done
      - :star: They panic and sell when market is low.
      - :star: They speculate and buy when market is high.
      - :star: Therefore, if small investors are selling their shares (when odd lot sales are up), it is a good time to buy.