Climax Volume & Reversals

How the heaviest volume of a move can mark its end, with real examples of a buying climax at a top and a selling climax at a bottom.

When everyone acts at once

Most moves end with a burst of activity. After a long rise, the last eager buyers pile in at once, often on a huge price jump and record volume. Once they have bought, there is no one left to push the price higher. That is a buying climax. After a long fall, frightened holders dump shares all at once. Once they have sold, there is no one left to push the price lower. That is a selling climax.

Climax volume is usually the heaviest volume of the whole move, often three or more times average. What makes it a climax is where it happens: at the end of an extended run, not at the start of a new one.

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