In VPA (Volume Price Analysis), it says that by analyzing price and volume, you can accurately understand the market’s direction. If price goes up with an increase in volume, it’s a strong signal that buying pressure is high. On the other hand, if volume decreases while price rises, it could mean someone is trying to dump their positions at the top. The classic principles from Jesse Livermore and Wyckoff are still valid today, and the author, Anna Coulling, shows that markets are ultimately driven by human emotions.
🧠 1. There's Nothing New — Human Psychology Remains the Same
“There is nothing new under the sun” — Ecclesiastes 1:9
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The market seems to change, but the fundamentals stay the same.
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People’s emotions like greed, fear, hope, and regret have always created repeating patterns in the market.
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No matter how many new technologies, like AI or algorithms, come out, the driving force behind the market is human emotions.
📖 2. Reminiscences of a Stock Operator — A Classic
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This book is the autobiography of Jesse Livermore, a legendary trader from 1923.
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One of his famous quotes is:
"There is nothing new on Wall Street. What happens today has happened in the past, and will happen again in the future." -
This also applies perfectly to the cryptocurrency market.
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The phrase "This time it's different" is often the most dangerous one.
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📈 3. The Essence of Trading is Price and Volume (VPA)
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If you understand the relationship between price and volume, you can read the market better.
Examples:
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If the price rises and volume increases, it means people are genuinely buying.
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If the price rises but volume decreases, it could mean someone is trying to sell at the top.
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This may seem simple, but it's a powerful analysis that works across all markets.
🧱 4. This Method Works in Every Market
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This method applies to all assets like stocks, futures, crypto, etc.
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It can be used in scalping, swing trading, or long-term investing.
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The market may change, but human psychology doesn't.
📊 5. Wyckoff's 3 Laws — The Expert’s Insight
Wyckoff is known as the father of Volume Price Analysis. His three laws are still valid today:
1. The Law of Supply and Demand
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More demand than supply = Price goes up
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More supply than demand = Price goes down
→ Basic principle: Prices are determined by how much people are willing to buy or sell.
2. The Law of Cause and Effect
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When there’s a quiet period with high volume (the cause), there will eventually be a strong move (the effect).
→ This helps you predict the accumulation and distribution phases.
3. The Law of Effort vs. Result
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If there’s a lot of volume but no price movement, something's off.
→ You should question if it’s a strong sell-off or just quiet accumulation.
📜 6. Charles Dow's Trend Theory — The Power of Reading Trends
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Charles Dow, a founder of technical analysis, believed trends happen in three phases:
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Accumulation Phase – Smart money starts buying quietly.
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Public Participation Phase – The public jumps in and the price moves strongly.
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Distribution Phase – Smart money starts to sell off.
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This trend also plays out perfectly in today's crypto market.
🎯 7. Tape Reading = Reading the Market’s Pulse
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In the past, traders analyzed stock prices through a “ticker tape,” but today, we use digital charts and volume.
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By mastering this, you can predict how big players or institutions might move next.
📌 Final Summary
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There’s nothing new in trading.
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Human psychology repeats itself, and markets follow these patterns.
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Forget fancy indicators and algorithms; understanding price and volume is the key.
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In the end, classics survive.
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"Listen to the market, understand its voice."
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* This article summarizes the content I learned from her book, "A complete guide to VPA". All copyrights belong to the author of the book.
💠 The 20-Something Who Made a Fortune in Crypto
💠 Chapter 2 : Trading Volume: The Only Window for Retail Investors to Peek Inside the Market
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