medium · Volume Price Analysis
A 'Failed Test of Supply' occurs when the price is pushed back into the accumulation zone but results in high volume.
What does this indicate to the insiders?
- The buyers are too aggressive, so the insiders must mark the price lower to find better value.
- Selling pressure (supply) is still present in the market, so the accumulation phase must continue.
- The market is now in a 'Price Waterfall' and all long positions should be closed.
- The breakout has already started and the high volume confirms the new uptrend.
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