medium · Volume Spread Analysis climaxes-tests-springs-upthrusts
You observe a wide-spread down-bar on ultra-high volume that closes in the upper third of its range after a prolonged decline. The next bar closes higher.
What is the institutional read of this sequence?
- Confirmed stopping volume, indicating that professional buying has absorbed the panic selling of weak holders, effectively arresting the decline.
- A selling climax means the bear market has already fully ended, and a mark-up phase will begin at once without any further testing.
- A shake-out is designed to trigger buy-stop orders placed by weak holders, and it typically occurs near the top of a distribution trading range.
- No selling pressure is present here, suggesting the market is falling under its own weight since professionals withdrew their bids from the tape entirely.
Sign up free to see the explanation and track your rank →
More Volume Spread Analysis climaxes-tests-springs-upthrusts practice
- While observing a downtrend, you see a bar that dips into fr… — What does this indicate to
- A stock has been in a markdown phase for weeks. Suddenly, a… — What is this sequence?
- What is the professional purpose of an 'Upthrust' - a wide-spread move up that collapses t
- A 'Failed Test' is identified when a price probe into a prio… — What does this signal to t
- What VSA signal has occurred?
- What happens during a 'Shake-Out' in a market that has been in a long accumulation phase?
- What third signal is required to complete Bearish Sequence 3?
- Which bar pattern provides the best 're-entry' opportunity during a temporary pullback in