Page 47 - A Complete Guide to Volume Price Analysis: Read the book then read the market

Fig 5.14 Low Volume Test – Good News !

Here we have the end of the distribution phase. The warehouses are empty, and the next stage is a sharp move lower, to repeat the process and
move into an accumulation phase once again.

As the distribution phase ends, the insiders want to make sure that there is no demand still remaining in price areas which, until recently, had seen
strong buying during the entry into the distribution phase. Once again, they test. The market is marked higher using some news, and if there is no
demand, closes back near the open, with very low volume. This is what the insiders want to see. No demand, as shown by the low volume. They are
now safe to start moving the market lower, and fast, as they now need to replenish their warehouses again.

Fig 5.15 is definitely NOT what the insiders want to see as they prepare to move away from the distribution price region. The market is marked
higher and buyers flood in, thinking that the bullish trend is set to continue and move higher still. As before, a failed test stops the campaign in its
tracks, and the insiders have to move back into the distribution price area, and clear these buyers out of the market, using the same processes as
before. Once complete, then a further test is made, and if on low volume, then the trend lower will gather pace, and move quickly away from the
distribution region, trapping traders into weak positions at this level.