Emotions and Structure: Why "Panic Volume" is Worth Extra Attention
There is a K-line pattern that I pay special attention to:
Panic decline + Significant volume + Closing not making a new low.
It may imply several things:
Leverage positions are being concentrated and liquidated, causing a stampede;
Patient capital is supporting at lower levels;
Market short-term emotions are being released all at once.
Of course, this does not mean to immediately go all in and bottom-fish,
but structurally, this is an important "divergence point."
What I would do is:
Take note of this K-line,
Monitor its highs and lows for a period of time,
because it is very likely to become a reference coordinate for a stage.
