medium · Volume Spread Analysis background-trend-context
A stock gaps up to open above a three-month resistance zone on high volume and closes near its high with a wide spread.
Why is this considered a 'Strong Gap-up' by professionals?
- It creates a 'sucker trap' luring retail investors into buying right at the highs.
- It discourages locked-in traders from selling by turning their losses into profits instantly.
- The high volume on this bar shows that supply is completely swamping the market-maker's control.
- It signals that the market-maker is trying to quietly sell off their existing inventory.
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