hard · Volume Price Analysis climactic
A stock has fallen for six weeks. In week seven, a wide-spread down candle closes at its low on the heaviest volume of the decline, a textbook Selling Climax footprint at first glance. Two sessions later, another wide-spread down candle appears, printing a new low, but this time on volume barely above the seven-week average, and it also closes near its low.
What does the second wide-spread down candle most likely reveal about the first?
- The first candle marked genuine capitulation, and the second just confirms the same downtrend continuing.
- Sellers drove an equally wide new low without needing climactic volume, so capitulation wasn't real.
- Closes near the low always mark accumulation, so both candles are Buying Climax signatures here.
- The second candle is a No Supply bar, proving sellers have fully exhausted themselves already.
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