hard · Volume Spread Analysis supply-demand-smart-money

An index is trading within a four-week distribution range. Price pushes above the upper resistance line on a wide spread with high volume, but immediately reverses to close near the low, back within the range. The following bar opens lower and closes on its low with expanding volume.

Which market maneuver was just completed?

  1. Absorption volume overcoming the supply from locked-in traders.
  2. A genuine breakout that is undergoing a normal test of the breakout level.
  3. A shake-out designed to remove weak holders before a sustained mark-up.
  4. An Up-Thrust After Distribution (UTAD).

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