OK for any who are still interested over here.
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In response to the potential weakness (supply) seen on Monday, price put in a mini shakeout (of sorts) on Tuesday.
The actual TG indicator would either be a 'test' or 'basic test', as both of these types of tests can also take the form of a small'ish shakeout.
A shakeout is a sign of strength. And is a type of test, just a more violent type of test than usual, where price rams down in an attempt to panic any weaker holders into selling and therefore clear the path higher (and remove as many potential sellers above the current price as possible).
So the price action is still attempting to be positive, as it generally has been since the stopping volume bar arrived.
Just so I can be clear on tests, there are actually nine different types of tests (which is why I try to simplify all this stuff, as it just overcomplicates things I reckon).
Tuesdays test, did not really have a narrow spread, or low volume, but it did close back in the top half of the bar.
And there is no doubt support again came in and absorbed the supply that knocked the price lower, otherwise it would have closed lower on the bar, and/or pushed even lower down in price (in search of support (buyers)).
A bar of this type will usually do one of two things now, it will attempt to rally in response to the strength seen on Tuesday, or it will retest- looking for actual low volume and narrow spread, before attempting to rally.
It should also be remembered that the initial bar that showed some strength, the stopping volume bar, has done just that so far......stopped the downwards stride (trend)......and has moved price into a sideways range......at least for now anyway......
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