Wyckoff trading method, page-525

  1. 16,642 Posts.
    lightbulb Created with Sketch. 1291
    Yep, that is pretty good, although at the time, the first bar would have looked pretty bearish, and it was not until the second bar was up, that you would have known it contained support.

    Individually the downbar (on excessive volume) which closed just slightly off the lows, didn't really give many hints that there was buying within it.
    Possibly the amount of volume did not equal the amount of spread...so the volume was potentially a bit excessive.
    So at that time, if there was support within it, it was hidden buying........as it could just as easily been another breakdown bar.....

    Then the second bar moves sharply higher in response, easily closing above the high of the previous bar (which is generally quite bullish).
    The lower volume infers there was a temporary supply vacuum (all the supply at this level was bought the day before, leaving a temporary lack of selling pressure).
    And the up bar confirms there was buying, or support, in the first bar.

    cheers
 
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.