DislikedIts confuses me that the test bar isn't a test bar.. When that bar printed professionals saw there were no serious sellers around so they took price up 70 pips. The expansion volume is where the professionals entered the market, its also during the CAD market open, which paying attention to and putting alot of weight on what a currency does during its home session makes a lot of sense to me. Granted, the last two bars (Bars A and B) of the up move look like supply, but it make sense this is profit taking and retail traders trying to sell because...Ignored
-the function of a test bar is to confirm the background, e.g. "Yes, the low volume narrow spread bar is contextually correct because supply has exhausted in the background". i.e. it is the background that gives meaning to a bar.
however, the test bar in question is contextually incorrect because directly behind it
1) price broke down more than 50% of previous swing
2) Bar A - breakdown bar with surge in volume
both indicates there's supply in the market
if i was looking at this chart in real time, at that point in time i would be looking for a weak rally to short, but market had other idea and printed a change of behavior up wave.