How to find a bubble
NKLA is a nice example to explain how a bubble can be recognized. On the left is the Volume over price plotted. The bottom area is a “loading zone” where the trade can begin. That’s indicated by a high amount of volume and that’s where you could get in. On top of that is the “earning zone” with nearly the same amount of volume but much denser. In between is much less volume: The “hype zone”. When the Stock reached a certain hight all the Traders which where into the stock are getting their profits in the “earnings zone”. That’s where you should leave the stock and when the Trade is over. Whenever you find a stock with that high amount of volume on the top, you should be very careful.
That’s my opinion and should be treated like it.
No trade advice!
That’s my opinion and should be treated like it.
No trade advice!
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.