easy · Volume Spread Analysis effort-vs-result-spread
During a market decline, a stock produces a down-bar on a narrow spread with volume significantly lower than the prior few bars. It closes in the middle of its range.
What does this 'No Selling Pressure' bar indicate?
- This is a sign of extreme weakness because the price failed to close higher.
- This is an up-thrust designed to trap breakout traders.
- Professionals are not participating in the decline, suggesting the path of least resistance may soon turn up.
- The narrow spread shows that buyers are trapped and unable to exit their positions.
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