Intra Day Volume

During most normal days there are certain times of the day that exhibit the higher volume as the action occurs. Typically you will see very high volume during the first hour or so as the market responds to the overnight news. Good or bad overnight news traders will adjust their market positions. This happens as the market opens and will tail off as the day progresses. Usually the market will enter its lull after an hour or two. Then the market makers and traders are thinking about lunch and at midday the market is typically trading its lowest volumes.


As we are within one to two hours of the close the trader is becoming aware of what companies are reporting news (and other news) after the market closes and how it will affect the next days open. Again the posturing occurs as the trader positions himself for the next day’s action. As we approach the close the volume will start ramping up again.

I am not suggesting you day trade stocks but wish to make you aware of this in your longer term stock purchases. For example if there is some good news on a stock overnight that you intend buying you might watch it moving up after the market opens and buy it perhaps an hour or two after the open. It is very common after the big gain of the first one to two hours for profit takers to step in and sell it off a little. So if you buy after the initial rise you may be a little upset to see the price fall back some. In fact it is common for stocks with good news to rise early on with good volume then fall back some on lower volume, only to rise again as we go into the close. I wish it was this easy though because a really powerful stock will go up at the open and continue rising all day, you just never know. The motto of the story is if you are interested in a stock and it has already risen up today yet it is now falling back then wait for the fall back to end and buy as it starts climbing again. This essentially gives you two good opportunities to buy a stock, soon after the open when you see it climbing or later in the day if it falls back on lower volume.