medium · Volume Price Analysis

Why do markets typically fall faster than they rise, and how is this reflected in the VPA markdown phase?

1. Gravity makes falling far easier than rising; therefore, the markdown phase typically requires less trading volume to move prices than the markup phase.
2. Insiders have empty warehouses after distribution and want to refill at the lowest prices quickly; this creates wide-spread down candles with rising volume (Panic).
3. Fear is widely regarded as a much weaker emotion than greed; thus buyers tend to hold longer in a downtrend than in an uptrend, which shrinks candle spreads.
4. Markdown is actually slower because insiders must patiently sell off their remaining inventory over time; it is the markup phase that is rapid, driven mainly by FOMO buying.

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