medium · Volume Spread Analysis supply-demand-smart-money
A stock breaks below a 10-week support level on a wide spread with volume 2.5× the 20-day average, but closes near the high of the bar. The background shows a selling climax six weeks prior.
Is this a genuine breakdown or a shake-out?
- A genuine breakdown, because the ultra-high volume confirms selling pressure.
- A 'Bag Holding' scenario where professionals are trapped in their positions.
- A shake-out, because the close is high and the background contains strength.
- A 'Failed Test' indicating the market is not yet ready for a mark-up.
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