TERMINAL VOLUME

Not so long ago I wrote about the recent drop in daily overall market volume and its
possible implications on share prices..Daily volumes of about 700 to 900 m shares were traded
then...that unfortunately have since dwindled to an even more worrisome 500 to 600 m shares
the last few sessions..a sure sign of a lack of interest and confidence in the share market...Again there
is no point debating the probable causes...a more fruitful discussion would be to do a brief analysis as to the type and nature of the buyers and sellers in the current market and hopefully one can spot opportunities for bottom fishing or scalping activities...

In a worst off scenario an extremely low volume can "stall " a market not unlike a plane in the air which
 has cut its airspeed too drastically ..but the market as it looks now does not seem remotely close to that..fortunately...Conversely a low volume has its silver linings too ...as contra or short term players are substantially out ,there would be much reduced forced selling activities which can depress prices further...As long as the forces of buying and selling are in equilibrium ie normally at strong support levels the prices would hold..there might be temporary breaks below but they are usually mended in the following days...of course this pattern may not hold for shares which have heightened "play " or are been sold down due to undisclosed negative development..Fundamentalists should take note of "equilibrium" levels as a possible entry point when the market shows signs of an uptrend...Chart readers would use this bottoming as a potential entry point as well.but caution is still key as depressed volumes and margin calls or uplifting of share moratoriums can break long term supports just as easily...    

Lulls in market activities can enable sharp eyed observers to look for potential insider buying and selling as well ...Bid patterns can highlight "unusual " buying or selling patterns which are sometimes not discernible in charts..Small to significant profits can be made ...if the timing of entry or exit is correct...An early sell action may also save precious capital from going down the drain...

That said ...many are still hoping for a partial window dressing exercise on the last trading day...

Hope readers will have a profitable day as we draws nearer to the year end.

Please do visit my blog http://traderight88.blogspot.com or else can email me chrischoo007@gmail.com if you any queries.

Thank you

Chris Choo