medium · Volume Spread Analysis supply-demand-smart-money
In a rising market, you see a bar that gaps up on a positive earnings report. The stock reaches a new high but closes near its opening price, creating a narrow spread on ultra-high volume (RV = 3.2). The next day, the stock closes lower.
What manipulative tactic is likely being used?
- A 'Trap Up-move' designed to distribute stock to FOMO-driven retail buyers.
- A 'Spring' below the current support level to trigger stops.
- A 'Shake-out' designed to scare away short sellers before a further rise.
- A 'Breakout' attempt that requires a 'Test' before continuing higher.
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