Technical Indicator Practical Combat Lesson Six: "Volume" ends here.

We have thoroughly reviewed volume from basic concepts to practical applications, from the relationship between price and volume to main force tracking.
This is the final lesson in the technical indicator series, and also the most down-to-earth one—because all indicators can deceive, but volume (especially on-chain data) is relatively genuine.

I. What did you learn today?
1. The essence of volume: the market's "thermometer"

Volume is the "process" of price changes; price is the "result."
Price movements without volume lack sustainability and are prone to reversals.
It's like a person with a fever—just looking at the face isn't enough; you also need to measure body temperature.

2. The four classic volume-price relationships

Price rises with increasing volume: healthy upward trend, strong buying, trend credible.
Price rises with decreasing volume: warning sign, no follow-through, possible pullback.
Price falls with increasing volume: panic selling, unloading at high levels or the last dip at low levels.
Price falls with decreasing volume: exhaustion of selling pressure, bottom area, waiting for volume confirmation.

Mnemonic:
Healthy bull with rising price and volume,
Price up, volume down, better turn around;
Price down, volume down, bottom near,
Price down, volume up, panic sell.

3. Volume-price divergence—strongest early warning

Top divergence: new high in price, shrinking volume → upward momentum exhausts, prepare to top out.
Bottom divergence: new low in price, expanding or minimal volume → downward momentum exhausts, prepare to bottom out.

4. Quantitative standards for volume increase and decrease

Volume increase: >20-day moving average line × 1.5 times;
Significant volume increase: >2 times;
Sky volume: >3 times.

Volume decrease: <0.6 times;
Minimal volume: <0.3 times.
Altcoins are more volatile; volume thresholds can be adjusted upward to 2-3 times.

5. Multi-timeframe volume analysis

Short-term: 1-hour / 4-hour charts,
Swing: daily chart,
Long-term: weekly chart.

Volume accumulation: sustained gentle volume increase at low levels, main force accumulating, bullish outlook.
Volume plateau: dense trading zones forming strong support/resistance.

6. Differentiating true breakouts from false ones with volume and price

True breakout: volume ≥1.5 times, sustained volume after breakout, pullback with decreasing volume for confirmation.
False breakout: no volume or single spike volume, quick volume decrease after breakout, long upper shadow with huge volume.

7. Main force fund tracking

Unusual volume: sudden huge volume, continuous volume increase, volume lagging price rise, abnormal movements at the end of trading.
On-chain auxiliary signals: large transfers, exchange net inflow/outflow, stablecoin reserves, miner holdings.

8. Special handling for altcoins

Poor liquidity, volume easily manipulated, need to compare across multiple exchanges + on-chain verification.
Only trade coins with daily volume > $10 million.

II. Core principles (mnemonics)
Volume is the thermometer; only with volume-price coordination is it real.
Price up, volume up, healthy bull;
Price up, volume down, need to turn back;
Breakouts must have volume; no-volume breakouts are fake.
Combine on-chain data to watch main force;
Sky-high volume drop, don’t worry.

III. Post-class homework
Open Bitcoin daily chart, find a segment of "price rising with volume increasing" and "price rising with volume decreasing," and take screenshots for comparison.

On the 4-hour chart, find 2 true breakouts and 2 false breakouts, record their volume features.

Use 🛠️ to check the net inflow/outflow of exchange BTC over the past 3 days, and write a 50-word analysis based on the price trend.

Overall summary of this Saturday's lesson:
From candlesticks to volume, the technical indicator system is fully implemented.
Dear crypto friends, today is Saturday, May 23, 2026.
Starting from this Monday, we completed six days of practical technical indicator series courses:

Monday (5.18): MA Moving Averages—The Anchor of Trends, Using Moving Averages to Judge Trend Direction
Tuesday (5.19): Bollinger Bands—Identify Consolidation and Breakouts, Capture Reversal Points
Wednesday (5.20): MACD—The King of Momentum Indicators, Use Divergence for Reversal
Thursday (5.21): KDJ—Short-term Quick Shooter, Precisely Catch Overbought/Oversold
Friday (5.22): RSI—Relative Strength Index, Judge Market Overheat or Cold
Saturday (5.23): Volume—Market Thermometer, Use Volume-Price to See the Truth

Six days, six indicators, a complete practical technical analysis system.

1. What have we established?
A four-dimensional analysis framework of "Trend → Position → Signal → Volume":

Use moving averages to define trend: MA20/60/200 to judge bullish/bearish direction, only long in bullish, only short in bearish.
Use Bollinger Bands to set boundaries: middle band indicates direction, upper and lower bands are limits, convergence signals potential reversal, divergence indicates trend acceleration.
Use MACD to observe momentum: golden/death crosses, zero line, histogram zoom, divergence is a trump card.
Use KDJ for short-term: fast line K, slow line D, J extreme values, buy at low, sell at high.
Use RSI to judge strength: over 70/30 overbought/oversold, 50 midline, divergence leads price.
Use volume to verify authenticity: rising price with increasing volume is healthy, no-volume breakout is fake, on-chain tracking main force.

2. The "truths" of each indicator
Moving Averages: only long in bullish, only short in bearish, observe for crossovers.
Bollinger Bands: above middle band only long, below only short, wait for divergence or convergence.
MACD: look at direction via crossovers, quickly act on divergence, above/below zero line.
KDJ: 80 overbought, 20 oversold, extreme J values need caution, avoid chasing in one direction.
RSI: over 70 overbought, below 30 oversold, divergence signals top/bottom.
Volume: price up with volume up, healthy bull; price up with volume down, turn back; volume spike is fake.

3. The power of combined use
A single indicator has flaws, but combined they are like "nuclear weapons":

MA + Bollinger: trend + boundary and reversal points.
MACD + RSI: momentum + divergence, double confirmation for reversal.
KDJ + volume: signals + verification, avoid chasing on decreasing volume.
RSI + Bollinger: buy at lower band + RSI<30, sell at upper band + RSI>70.
Volume + on-chain data: identify true main force movements.

4. Next week's preview: fund management and trading psychology
Technical indicators are learned, but why do many still lose money?
Because they can't control position size and emotions.
Next lesson will cover:
Pyramid averaging, fixed percentage stop-loss,
Never lose more than 2% of total capital on a single trade,
How to overcome FOMO and panic selling,
Trading journal review and mental training.

5. Final words
Six days, six indicators, each lesson I explained in plain language, with real cases and interactive Q&A.
You don't need to memorize all details, but you must understand each indicator's core logic and applicable scenarios.

Remember: indicators are tools, not oracles.
There are no perfect indicators, only perfect combinations.
More importantly, discipline and execution.

Starting tomorrow, please:
Write the "truths" of the six indicators on sticky notes and stick them beside your computer.
During daily review, cross-verify your judgment with at least three indicators.
Keep a trading journal, weekly analyze win rate and profit/loss ratio.

Trading is not about overnight riches; it's about accumulating small wins into big wins.
I am Wang Yibo, thank you all for a week of company!
See you next week in the fund management class!

Wishing your accounts stay in the green!