medium · Volume Price Analysis
If a trader identifies a 'Hanging Man' candle on the daily chart of AAPL, why should they wait for a second candle before entering a short position?
- Volume can be ignored for AAPL since dark pool activity means exchange volume no longer reflects real trading interest.
- AAPL is a high-volume stock that typically requires 'Triple Top' patterns to reverse, so a single candle can be dismissed.
- The long lower wick initially signals strength, and a subsequent 'Shooting Star' is needed to confirm the shift to weakness.
- The Hanging Man is actually a bullish signal at the top of a trend, and traders should expect the rally to continue upward.
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