medium · Volume Spread Analysis wyckoff-phases-schematics
If a market has reached a potential top and exhibits an up-bar with a narrow spread on high volume, but there is an 'old top' to the left at the same level, how does the interpretation change?
- The old top confirms that this bar is a double-top reversal, meaning it should be shorted immediately without delay.
- The bar might represent 'absorption volume' where professionals are buying supply from traders locked-in at the old high.
- The background 'old top' is irrelevant here, since VSA analysis considers only the current price-and-volume relationship.
- The narrow spread on this bar confirms resistance from the old top is far too strong for the market to overcome right now, period.
Sign up free to see the explanation and track your rank →
More Volume Spread Analysis wyckoff-phases-schematics practice
- During a distribution phase, how do professionals use 'Good News' to facilitate their stra
- Why is the '90-Minute Reporting Delay' on the London Stock Exchange significant for VSA pr
- In the Accumulation phase, why does volume typically remain low on rallies within the trad
- In the 'Mushroom Top' distribution pattern, why do prices round over gradually rather than
- A stock gaps up $3.00 on a positive earnings report after a… — How should this scenario be
- A stock gaps up from $78 to $81.50 following a positive earn… — How should a practitioner
- What is the diagnosis?
- To follow the 'Checklist for Going Short,' when should the trader ideally execute the entr