Selling Climax
Volume Spread Analysis glossary · Climaxes, Tests, Springs & Upthrusts
Definition
An ultra-wide-spread down-bar (or sequence of 1–3 such bars) on exceptionally high volume—often the highest seen in months—closing on or near the highs (or at least in the middle), occurring after a bear market that has been running for weeks or months. It marks a full capitulation by weak holders during widespread panic and bad news, and signals a major bottom forming. However, immediate upward movement should not be expected; the professionals who absorbed the panic need weeks of accumulation, testing, and possibly a shake-out before the mark-up can begin. Historical examples include October 2008, March 2009, March 2020, and October 1987.
Selling Climax in plain English
Picture a crowd that has been scared for weeks — bad news everywhere — finally panicking and dumping their shares all at once. A Selling Climax is that moment of total surrender: the price drops on a very wide bar with the heaviest trading volume in months, yet it closes near the TOP of that bar. Why the top? Because big professional buyers were quietly buying up every panicked share being thrown at them, and that flood of buying stops the fall. It usually marks a major bottom — but don't expect the price to shoot up right away; the pros need weeks to quietly gather more, test the low, and sometimes scare out stragglers before the real rise begins. (Real examples: October 2008, March 2020, October 1987.)
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Practice Selling Climax
Which description best defines “secondary test of a selling climax” in this curriculum?
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