sideways market #till January
Wick Filling in Trends
1. In a Downtrend:
Wick Formation: When the market is in a downtrend and candles have downward wicks, these wicks represent temporary buying pressure or support zones.
Wick Filling: If the subsequent candle "fills" or closes within the wick of the previous candle, it indicates that selling pressure is still strong, and the downtrend is likely to continue.
Non-Filling of Wicks: If the next candle fails to fill the wick, it suggests that buyers are starting to gain strength, possibly signaling a reversal or consolidation.
2. In an Uptrend:
Wick Formation: In an uptrend, upward wicks represent temporary selling pressure or resistance zones.
Wick Filling: If the next candle fills the wick, it suggests that buying pressure is strong enough to overcome resistance, and the uptrend is likely to continue.
Non-Filling of Wicks: If the next candle does not fill the wick, it may indicate weakening buying pressure and a potential reversal or pause in the trend.
Key Idea:
Wick Filling: Confirms the strength of the current trend (either up or down).
Non-Filling of Wicks: Often signals hesitation in the market, which could lead to reversal or consolidation.
How This Relates to Market Psychology:
Wick filling reflects liquidity grabs, where market makers may push prices into wick zones to trap retail traders or trigger stop-losses before continuing the trend.
Failure to fill wicks can indicate exhaustion of the dominant trend and the presence of opposing pressure.
Practical Use:
In a downtrend, observe if candles consistently fill downward wicks — this is a sign to remain bearish.
If a downward wick isn’t filled, it’s a clue to watch for potential reversal patterns like double bottoms or bullish engulfing candles.
The same logic applies inversely in an uptrend.
Your understanding is spot-on, and this concept ties in beautifully with price action and smart money principles. Always watch these behaviors in conjunction with other signals like support/resistance or Fibonacci levels to make well-informed decisions.