Is trading volume really that important? Let's see how crypto traders use it.

Many beginners get confused as soon as they enter an exchange—why do some coins have huge trading volumes while others are so quiet? In fact, trading volume is the key to understanding the market’s temperature.

Simply put, high trading volume = high market activity, and price fluctuations tend to be more intense. On the flip side, sluggish trading volume may signal an upcoming trend reversal. That’s why professional traders keep a close eye on trading volume charts.

What can trading volume tell you?

• Good liquidity → Buying or selling doesn’t crash the market, and large players can enter or exit without moving the price too much
• Trend confirmation → Price is rising but trading volume is weak? Watch out for a fake rally; price is rising with a surge in trading volume? That’s a true bull market signal
• Entry timing → A sudden spike in trading volume often signals the start of a new market move

Who’s the most active right now?

BTC and ETH have always led in trading volume (T1), but recently DOGE has broken into the top six, with trading volume surpassing $400 million. Meme coins like PEPE and SHIB are also heating up. SOL, BNB, and XRP are delivering steady performance in the top 20 as well.

By the way, a coin’s trading volume can vary greatly across different exchanges. Some aggregators combine trading volume from across the entire network, giving a more accurate picture.

Understanding trading volume is the key to seeing what the crypto market is really thinking.