Volume Climax Triggers Profitable Reversal When Buying Pressure Changes
In today’s volatile trading environment, understanding the intricate relationship between volume and price action is crucial.
I want to share a recent crude oil trade I executed and the thought process behind it.
My goal is to help you understand how Hawkeye Volume tools can make these kinds of setups clearer and more actionable.
Identifying the Opportunity
This morning, as I analyzed the crude oil market, a few key technical signals caught my attention.
We had made a notably lower high, and on the retest of this lower high, it became apparent that the market was struggling to push higher.
The price action was telling a story, and it was one of weakening buying pressure and potential for a downside move.
At 7:09 a.m. EST, I saw the final confirmation I needed on the 3-minute chart for Light Sweet Crude Oil Futures.
The market pushed up into an area where price had previously fallen, creating what appeared to be a slight lower low and lower high.
This was where the real signal came in.
A large green candle appeared, with a huge surge in buying volume. Traditional volume analysis would interpret this as a bullish signal.
However, the Hawkeye Volume tools told a different story. Despite the large buying volume, the price failed to break through the resistance level.
This candle was what we call a “volume climax”—an indication that buyers had exhausted themselves and were unable to push the market higher.
This is where Hawkeye Volume stands out. It identified that despite the aggressive buying, the sellers were still in control, absorbing all the buying pressure.
This insight made it clear that the market was likely to move lower from this point.
Executing the Trade
Given the information provided by Hawkeye Volume, I decided to enter a short position.
Here’s how the trade played out:
- I entered short at 78.65, right at the close of the signal candle.
- My first target was hit at 78.45, where I took partial profits.
- I took additional profits at 78.25 as the market continued to move in my favor.
- Finally, my remaining position was stopped out at 78.40, still in profit.
GAIN: $5250.00 – Fees
While the market didn’t continue lower as aggressively as I had hoped, the trade was still profitable.
The key takeaway here is that the Hawkeye tools allowed me to identify the weakness in the buying pressure and execute a trade with confidence.
The Power of Hawkeye Volume
The success of this trade boils down to understanding the interaction between volume and price action.
Knowing who the aggressor is in any given situation—whether it’s the buyers or the sellers—can make price movements at key levels more predictable.
Hawkeye Volume doesn’t just show you how much trading is happening; it helps you understand the quality of those trades.
Are the buyers really in control, or are they being overpowered by hidden selling pressure? This is the kind of insight that can transform your trading.
Take Your Trading to the Next Level
If you found this breakdown helpful and want to dive deeper into these concepts, I invite you to join me for a training webinar.
In the webinar, I’ll walk you through the intricacies of how volume and price action interact, and how you can apply these insights using Hawkeye tools across various markets—whether you’re trading stocks, futures, forex, or cryptocurrencies.
The indicators we use are compatible with platforms like TradeStation, TradingView, NinjaTrader, and MetaTrader. Whether you’re a day trader, swing trader, or even a position trader, understanding this relationship is crucial for consistent success.
To get started, click the link below to join the upcoming webinar. Let’s work together to enhance your trading skills and achieve the success you deserve.
Looking forward to seeing you there…
Happy Trading,
Anthony Speciale
Hawkeye Traders
Big Energy Profits
