Chapter VIII: Volume Stratification Analysis tracks the volumes associated with price levels over the entire history of a stock. The resulting analysis yields a framework for understanding the mechanism behind support and resistance levels, and a scientific basis for predicting price behaviors due to those levels. |
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| Volume Stratification Analysis begins with the concept of the Volumetric Profile. This is nothing more than the cummulative volume according to price range. Here the price column corresponding to the current price of CAI stock is painted in red. |
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Blue bars depict the Volumetric Profile for various price levels of CACI Intl. The thick orange line is the Volumetric Price and the maroon line is the Secular Price. General Volumetric Health is 1 on a scale from 1 (best) to 3 (worst), because the price is above the Volumetric line, indicating some positive market sentiment. A few layers of volumetric turbulence exist that could provide support on the downside. The most significant of these is found around $35. |
| Support Level ID | Price Range | Peak Magnitude |
| 1 | $35.00 - $35.99 | 2.91 |
| 2 | $20.00 - $20.99 | 0.45 |
| 3 | $9.00 - $9.99 | 1.50 |
| At least two layers of turbulence might act as resistance levels above the current price, particularly the one near the $45 level. |
| Resistance Level ID | Price Range | Peak Magnitude |
| 1 | $45.00 - $45.99 | 3.89 |
| 2 | $61.00 - $61.99 | 1.91 |
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| Horizontal maroon lines indicate Negative Volumetric Peaks. Price intervals with these characteristics are often associated with gaps, although they sometimes operate as support levels. Quarterly and yearly turn-arounds are circled. Two sharply defined valleys exit below the priceline at $23 and $23. The deepest is near the $23 strata. |
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| Here, the horizontal lines mark the points of Maximum Negative Slope in the Volumetric Profile. These strata are known to act as resistance levels against upward movement, and are sometimes associated with yearly and quarterly tops. Also, as is typical of resistance levels, they may do double duty as support, but that is not the typical case. |
For Members: Deeper Analysis, with Price Predictions for CAI Common Stock |
| In the news, Monday, February 08, 2010: A favorable condition has developed with Nicor Inc., ticker symbol GAS. Also, there are breaking events concerning American International Group, Inc. (AIG) and United Technologies (UTX) |