What is volume?
Volume is the amount traded during the period a candle covers. It is shown as a bar for each candle below the chart. Volume measures participation in the market; on its own it does not say which way price will go. In crypto, the volume of the same asset varies by exchange and data provider.
What is volume?
Every trade has a buyer and a seller. Volume is the total amount that changed hands in those trades during a candle. On the 1H chart each bar shows one hour's volume; on the 1D chart, one day's.
Volume bars are usually drawn in a separate pane below the price chart. On most platforms the bar's colour follows the candle: green under a rising candle, red under a falling one. That colour shows the candle's direction, not the amount bought or sold.
Base and quote volume
- Base volume: the number of units of the asset traded. On BTC/USDT, it is how many BTC changed hands.
- Quote volume: the value of the same trades in the quote currency. On BTC/USDT, it is how many USDT were traded.
- Quote volume is roughly units × price, so it grows as price rises, even with the same number of units traded.
When comparing long periods, it matters which unit is shown. For an asset whose price has doubled, quote volume looks twice as large even if the number of units traded has not changed.
Why crypto volume looks different from place to place
Shares mostly trade on one central exchange. A crypto asset trades on dozens of exchanges and against different quote currencies (USDT, USDC, USD). Each exchange's chart shows only its own trades. Data providers add up the volume of the exchanges they choose, and which exchanges they include varies from provider to provider.
On some exchanges, zero-fee pairs or trades with oneself can make volume look higher than it is. So rather than comparing volume figures from two different sources directly, it is more useful to look at how volume changes against earlier candles within the same source.
Spot and derivatives volume
Spot volume is trading in the market where the asset itself is bought and sold. Derivatives volume is trading in futures and perpetual contracts. Because leverage is used, derivatives volume in the large crypto assets is often several times spot volume.
The two do not measure the same thing. A spot chart does not show derivatives volume, and a derivatives chart does not show spot volume. When reading a rise in volume, saying which market's data you are looking at makes the reading clearer. Open interest is a different measure again: it counts contracts still open, not contracts traded.
What it shows, what it does not prove
What it shows
- How much was traded during a candle, that is, the level of participation
- Whether a move came with more or less trading than the earlier candles
- In which candles and at which zones price drew more activity
What it does not prove
- Which way price will go; every trade has a buyer and a seller
- Who made the trades, or why
- The volume of the whole market; a chart usually shows only one exchange or a selection of exchanges
The MarketLevelMap view
How it relates to zones
Support and resistance zones are areas where price has reacted before. When price reaches a zone and volume rises against the earlier candles, participation is rising at the zone; this can be read as a hint that the market has noticed the zone.
Volume does not decide where the zone is; it describes how much trading came with the move at the zone. So it is sounder to keep reading the zone as a band through price and closes, and to use volume as information that goes alongside that reading.
Often confused with
For general information only. Not investment advice.Last updated: