hard · Volume Price Analysis vpa-core
After a nine-week downtrend, a session prints a wide-spread down bar that closes near its low, on volume 2.2× the 20-day average — the heaviest of the entire decline. Two sessions later, another down bar forms with volume 2.6× average, but this time the spread is narrow and the close sits in the upper third of the range.
How should the second high-volume session be classified relative to the first?
- The second bar is Stopping Volume, since its narrower spread and stronger close show insiders absorbing supply, not repeating the climax.
- The second bar is a second Selling Climax, since any bar carrying more volume than the first always repeats the reversal event.
- The second bar is a No Supply bar, since a close in the upper third of the range on a down day shows sellers have fully withdrawn from trading.
- The second bar is an Upthrust, since narrowing spread on rising volume during a decline always signals a false break above resistance.
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