Can you please explain to me why a large candle tends to have the highest tick volume bars?
I thought the large candles are supply demand imbalances in which trades Cant take place therefore should have the least volume.
Thanks
A candle is a position in time like a point. Only a candle has a start point and stops point in time.
What happens between these two pints is a war, the battle of the bulls and bears. There is a volume with this war which creates larger candles and smaller candles along with wicks.
Call it an imbalance but maybe its so simple as the strongest wins.
Don’t forget to check they highest and lowest point…
Thanks but I don’t believe this to be correct. During a large green candle for example there is no war. There is no supply which is why the green bar is large. Price is moving up to find supply. If there is lack of supply the can’t be a trading war. The war take place when Price moves in range. So I still do not understand why large candles have the highest volume.
Epidot, inside every candle the bulls and bears fight it out, there volume makes for small to large candles, if one seriously overpowers the other you get wicks.
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Yes I agree. However they say tick volume has a strong positive correlation with real volume of 90% . This should mean that most trading is done in large candles as they show the highest tick volume. This is not possible. When supply equals demand, price does not change… To explain my point better let’s say for example there are 1000 buyers and 0 sellers. Price will form a large green candle to find the sellers at a higher price and no trades will have taken place in that green bar. Do you understand what I’m saying now? Cannot have most trades volume in large candles.