medium · Volume Price Analysis climactic
What is the primary risk of acting on a single 'climax' candle (like a hammer with ultra-high volume) at the bottom of a sharp decline?
- A single candle cannot define the Value Area of the Volume at Price histogram.
- The momentum of the trend often requires several candles to 'stop the tanker'.
- The candle is likely a 'no supply' bar that will not lead to a reversal.
- The high volume indicates that insiders are still aggressively shorting the market.
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