medium · Volume Spread Analysis background-trend-context
A practitioner identifies 'Stopping Volume' on Tuesday during a sharp decline. Wednesday's bar is a narrow-spread up-bar on low volume, and Thursday breaks below Tuesday's low.
What is the correct interpretation?
- This is a shake-out designed to clear the final weak holders.
- The market is in an accumulation phase and Thursday is a 'Spring'.
- The stopping volume was insufficient; the decline is continuing due to a negative response.
- Professional support is being built and Thursday is a 'Test'.
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