Trading volume represents the total number of shares, contracts, or units traded in a security or market during a specific period. Volume analysis helps confirm price movements, identify trend strength, and assess market participation. High volume often validates price moves, while low volume may indicate weak conviction.

Volume patterns provide insights into supply-demand dynamics, institutional activity, and market sentiment. Volume spikes often accompany significant news or technical breakouts. Understanding volume analysis helps improve trade timing, confirm signals, and assess the sustainability of price movements.

Real-world example: Tesla stock breaks above $270 resistance on volume of 40 million shares, triple the daily average, confirming strong buying interest and supporting the validity of the upward breakout movement.