hard · Volume Price Analysis vpa-core
A commodity has been trading in a tight range for six weeks. Today it gaps up sharply at the open on news, immediately printing a wide-spread candle on 4.5x average volume, then closes the session near the LOW of that same wide range, well below the opening gap.
What is the most defensible VPA interpretation of this single bar?
- This is a bullish breakout confirmation, since the ultra-high volume proves overwhelming demand entered on the news regardless of where the session closed.
- This is an Upthrust: the gap and heavy volume drew in buyers, but the weak close near the low shows supply absorbed and reversed the whole advance.
- This is stopping volume, since any bar with volume above 4.0x average automatically halts the prior trend and signals an imminent reversal higher.
- The close is irrelevant here because news-driven gaps are exempt from ordinary VPA volume-and-spread analysis.
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