medium · Volume Price Analysis support-resistance
During an accumulation phase, the price drops below the established support floor, triggers several stop-loss orders, and then rallies to close back above the floor with high volume.
What Wyckoff event does this describe, and what is the trade implication?
- A Spring; this is a bullish signal indicating insiders have 'shaken out' weak sellers and are ready for markup.
- A failed test of supply; the accompanying high volume shows too many sellers remain for the market to rise.
- Stopping volume; the insiders are applying the brakes to a falling market before genuine accumulation can begin.
- An Upthrust; this is a bearish signal showing that buyers failed to hold the support level and were trapped by insiders.
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