hard · Volume Spread Analysis climaxes-tests-springs-upthrusts
A practitioner observes a spring on Bar 1 (low volume, high close). Bar 2 dips back into the spring's range and closes on the high, but the volume is twice as high as Bar 1. Bar 3 is an up-bar with a wide spread and high volume.
Is the test on Bar 2 successful?
- No, Bar 3 is an upthrust because it followed a high-volume test bar.
- The test on Bar 2 is technically a failure due to high volume, but Bar 3 shows demand is now overcoming the remaining supply.
- Yes, Bar 2 is a successful test because the close was high, which is more important than volume.
- The sequence is a classic mushroom top distribution pattern.
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