medium · Volume Price Analysis

Identify the 'Anomaly' in this scenario: Crude Oil futures rise from $72.50 to $73.80 over four bars. The volume bars for these four up-candles are as follows: 22K, 18K, 14K, 11K.

1. This is a 'No Demand' sequence on a single bar that indicates an immediate and total collapse in price.
2. This is validated bullish action, since price is simply making higher highs across all four bars shown.
3. The declining volume here is actually a 'Test of Demand' that validates further moves higher from this level.
4. The trend is exhausted because volume is declining as price rises, indicating a lack of institutional demand.

Sign up free to see the explanation and track your rank →