no, that's OK, when potentially strong buying like that arrives,...

  1. 16,642 Posts.
    lightbulb Created with Sketch. 1291
    no, that's OK,

    when potentially strong buying like that arrives, if this is the 'real thing' and an accumulation zone, or trading range is started, the first rise like this ( the AR or Automatic Reaction/Rally) will often establish where the 'creek' lies.
    Effectively, after the strong buying, those holders that are going to sell in panic have done so, and a temporary supply vacuum is created. This allows price to rise easily on reduced volume (because there is reduced selling pressure). So price rises until it eventually draws out enough supply to halt the rise (an equilibrium between supply and demand is reached), and quite often the 'creek', or the highs of a new trading range is established at this point.

    cheers
    Last edited by Jako8557: 07/12/16
 
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.