medium · Volume Spread Analysis supply-demand-smart-money
A stock is in a downtrend. It produces a bar that dips down on a wide spread but recovers to close on the high, with volume that is higher than average. The next bar is an up-bar.
How does this compare to a standard 'test'?
- This is a 'shake-out,' a distinct, more aggressive maneuver, not functionally the same as a test.
- This is a 'failed test' or 'stopping volume' because the volume was high rather than low.
- This is a stronger version of a test, since it displayed noticeably higher market participation.
- This is 'no selling pressure' simply because price managed to close on the bar's high.
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