hard · Volume Spread Analysis background-trend-context
Following a spring and mark-up, the practitioner observes a 'no demand' bar at the upper trend line of a channel.
If the background shows strong accumulation, how does this change the interpretation compared to 'no demand' after distribution?
- In a strong background, no demand may only be a temporary pause or a 'lull' in professional activity, and should not be used as a short signal without an upthrust.
- No demand functions as a universal reversal signal; its appearance right at a trend line confirms that the bull move is finished, no matter the background.
- The practitioner should double the position size right away, since the low volume there supposedly proves there is no meaningful selling pressure at the resistance level.
- The no-demand bar sitting at the trend line is actually best interpreted as a 'test of supply,' since it occurs on low volume during an already well-established uptrend.
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