Many people ask about volume and why it is so important in trading. Volume simply refers to the total trading amount of a cryptocurrency over 24 hours, meaning how much has been exchanged in a day. It is measured either in dollars, euros, or even in the same currency like Bitcoin and Ethereum.

Why is volume important? The truth is that trading volume tells you about the actual liquidity of the asset. The higher the volume, the easier it is to buy and sell the asset without significantly affecting the price. This means you don’t need to worry about the price dropping when you try to sell a large amount.

Demand for the asset increases with rising volume, which naturally impacts the price upward. High volume reflects genuine interest from the market and investors.

There are many factors that influence trading volume. First, market sentiment — when investors are optimistic, buying and selling increase, and volume goes up. Second, news and events — when a government announces a ban on cryptocurrencies, it can move the market wildly, and volume spikes quickly. Third, technological developments — new protocols or updates attract attention and boost activity.

But be cautious — some people try to manipulate trading volume through pump-and-dump schemes, artificially inflating the price before selling. So, you need to be careful and not rely solely on volume when making trading decisions.