medium · Volume Price Analysis
During an intraday session, a currency pair breaks above a well-defined resistance ceiling at $1.2200. The breakout candle closes at $1.2235 but the tick volume is only 0.55x the 20-bar average.
What is the appropriate response for a VPA practitioner?
- Enter long immediately because the price has cleared the congestion zone with 'clear water' above.
- Identify this as an 'Upthrust' and immediately enter a short position with a stop at the breakout high.
- Enter long with a half-size position since the price close is valid even if the volume is low.
- Stand aside and wait for a reversal or a high-volume validation, as this is likely a fakeout.
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