Volume Contraction Pattern Amidst Dual TrendlinesThe chart reveals important price structure and behavior over the past 18 months, featuring both a prominent counter trend line (marked in red) and a long-term support trendline (marked in green). Each element signifies distinct phases of supply absorption and buyer interest.
• Counter Trend Line (Red): This line has consistently acted as a pivot for multiple lower highs, reflecting the presence of vigilant sellers at each attempt to move higher. Multiple reaction points along this line indicate repeated supply emergence whenever price approached the zone, especially after sharp rallies earlier in the trend.
• Support Trend Line (Green): The green upward-sloping line marks sequential higher lows. This support axis has been respected multiple times, hinting at growing accumulation at each retest despite temporary price weakness in the broader market. The curvatures at lows (forming cup-like bases) display periods of volatility contraction and constructive price action as buyers step in at successively higher prices.
• VCP Dynamics: The pattern visible in the chart exhibits systematic contraction in the price swings. Each corrective structure—characterized by the curved reactions at support—shows a shrinking amplitude in both price and volume. This VCP sequence typically points toward consistent supply absorption, with sellers getting exhausted at lower levels after each contraction. The emergence of strong green candles with above-average volume near the support line often signals a revitalization of demand forces, as seen recently.
