More quotes from Tom Williams: High volume on a down-day/bar always means selling...
Absorption volume typically marks the end of a downward trend. It is characterised by a very high volume bar that closes below the previous bar, on a wide spread. In normal circumstances, this would be construed as selling, but the defining difference is that the bar closes on the high. If the high volume had representedselling, how can the price action close on the high? There was a huge amount of buying (absorption) on this bar.
By the way the bottom chart is from July 26th. Notice the similarities to today. TZA closed at 29.88 on July 26th and started rallying the next day. It gained 33.8% by August 24th.
Hi:
ReplyDeleteI came to know your blog from Cobra's blog.
So you are saying that TZA has marked a bottom and will start climbing? This means the market will go down. It chimes with Cobra's analysis (and the analyses of others).
Frank
Yeah, but the question is always when, for how far & for how long. Is any downtrend short term, intermediate or more long term? Overall long term still looks down, but things never go in one straight direction. Cobra has a great site. I'm unclear what his Long Term Projections are for the market. Never get stuck with one opinion. Develop a system, stick to it until it succeeds or fails & protect & listen to yourself...
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