easy · Volume Spread Analysis effort-vs-result-spread
An equity is in a steady uptrend. Today, it produces an up-bar with ultra-high volume (RV > 2.50), but the spread is extremely narrow and the price closes in the middle of the bar.
What is the most likely professional intent behind this activity?
- The market-maker is aggressively marking up prices to reflect high demand.
- The narrow spread shows a lack of retail interest despite high professional buying.
- The market-maker is selling into the retail demand to cap the price.
- Professional traders are withdrawing from the market, leading to thin trading.
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