Relative volume is how much has traded so far today, divided by how much normally trades by that same hour over recent days. A value of 1 is a normal day. A value of 3 means three times the usual — something drew attention. A value of 10 means the stock is on a great many desks at once.

The hour-matched comparison is critical. Comparing volume at 10am against a full day's average is meaningless and will make you miss exactly the names where the move is starting.

Price without volume is noise. A stock up 4% on normal volume is usually a random wiggle that closes back; a stock up 4% on five times normal volume is real money coming in. The identical move, two opposite conclusions.

Volume also has a direct risk consequence: it's what lets you get out. A perfect pattern in a barely-traded name is a trap — you'll get in easily and discover there's no one to sell to when you want out.

Below 2, don't bother. Between 2 and 5 there's interest — go find the news. Above 5 there's a genuine event, and those are the names that make the watchlist. But note the other side: extreme volume in a small-float name also means moves that can jump over your stop, so size down.