medium · Volume Price Analysis climactic
A practitioner is monitoring a sequence of three up-candles. Each successive candle has a higher close, but each candle's spread is narrower than the previous one, while volume is rising for each.
What is the signature here?
- Trend Validation, suggesting that a healthy and fully sustainable markup phase is underway.
- A Short Squeeze, indicating that shorts are being aggressively and forcibly squeezed to cover.
- The start of a Price Waterfall, suggesting that a rapid bearish decline is now imminent.
- Topping Out Volume, indicating that the insiders are selling into the rally as it loses momentum.
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