medium · Volume Spread Analysis wyckoff-phases-schematics
A practitioner combines three consecutive ambiguous daily bars into a single 'composite bar.' The composite shows a wide spread, a probe to new lows, a close on the high, and ultra-high total volume.
What has been revealed?
- The market is simply moving at random and thus cannot be meaningfully analyzed.
- A no-demand signal, because the price took three full trading days to recover its footing.
- A signal telling the trader to permanently switch from daily to weekly charts for future analysis.
- A hidden 'shake-out' or 'selling climax' that was not apparent on a single-day basis.
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