medium · Volume Spread Analysis background-trend-context
A stock has been trending upward for six weeks. You observe a wide-spread up-bar that closes in the middle of its range on ultra-high volume, exceeding 2.5 × the 20-day average. The following bar is a narrow-spread down-bar on low volume.
What is the most likely professional activity occurring on the ultra-high volume bar?
- Professional absorption of remaining supply
- Institutional buying following the trend
- A healthy test of the current demand
- Supply entering the market to cap the move
Sign up free to see the explanation and track your rank →
More Volume Spread Analysis background-trend-context practice
- Why is the 'Background' (previous activity) considered the most important factor when read
- A stock chart shows a 'low-volume test' at $38.50. The pract… — By shorting at this point
- A practitioner sees an 'up-thrust' (wide spread up, close on… — What does this 'negative r
- Historical data shows that indices can make new highs long a… — Why does this 'Market Rota
- What is the resulting Background Score, and what does it imply for a potential long trade?
- Suppose a stock is approaching a known resistance level. It… — How should a practitioner v
- After a period of distribution, the market attempts to rally… — What does this indicate?
- Does the current high-volume down-bar still represent a professional Shakeout?