hard · 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'?

  1. This is a 'shake-out' which is functionally identical to a test.
  2. This is a 'failed test' or 'stopping volume' because the volume was high rather than low.
  3. This is a more powerful version of a test because it showed higher participation.
  4. This is 'no selling pressure' because the price managed to close on the high.

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