Stopping Volume
Volume Spread Analysis glossary · Climaxes, Tests, Springs & Upthrusts
Definition
A wide-spread down-bar on very high or ultra-high volume, closing at or near the high (or at least in the upper half), with the next bar level or up. It indicates that professional buying has absorbed a wave of panic selling, arresting an existing decline. Stopping volume does not mean the bottom is in—it means the decline has been halted; expect a period of sideways accumulation, and treat any subsequent low-volume test of the area as a strong buy signal. The analogy: a downhill skier turning sharply at the bottom of a run—the spectacular spray of snow (volume) brings him to a halt, but he is not yet going uphill.
Stopping Volume in plain English
Stopping volume is the moment a falling market slams on the brakes. You see a tall down-bar on huge volume, yet instead of collapsing to the bottom it closes near the high (or at least in the upper half), and the next bar holds steady or ticks up — the sign that heavy professional buying has stepped in and soaked up a flood of panic selling. It does NOT mean the bottom is in and prices are about to rocket; it just means the slide has been halted, so expect a stretch of sideways drifting, and if you later see a quiet, low-volume dip back to that area (a 'test'), that's a strong buy signal. Picture a skier bombing downhill who carves a sharp turn at the bottom: the dramatic spray of snow is the volume that kills his speed — he's stopped, but he isn't climbing back uphill yet.
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