easy · Volume Price Analysis
A stock has fallen for 10 days. On day 11, it drops another 3 percent but finishes only 0.5 percent down, with the highest volume of the year.
Is this validation or an anomaly?
- Validation, because the price still closed lower.
- Anomaly, because volume should be low at the bottom of a trend.
- Anomaly, because the huge volume (effort) produced a very small price drop (result).
- Validation, because the trend is bearish and the volume is high.
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