Rising volume and price are a normal phenomenon. This combination indicates that the market is in sync and has no forecasting value, except that it is normal to expect the final top in prices to bepreceded by a peak in volume. Volume normally leads price. A new high in price that is not confirmed by volume should be suspect, and that the current trend may be about to reverse. Rising price and falling volume are abnormal and indicate a weak rally.
Volume measures the enthusiasm of buyers relative to sellers.
Higher prices and lower volume indicate the market is rallying because there is a shortage of sellers, not because buyers are enthusiastic. Sooner or later the market will reach a price level that attracts sellers. When this occurs, prices will fall substantially. A parabolic rise in prices and a sharp increase in volume are unsustainable, which typically results in an exhaustion move. Exhaustion is characteristic ofan important market turning point.