The first significant rally that occurs after a prolonged decline that indicates budding demand showing up. It is usually associated with a minor panic preceding that rally.
Selling Climax (SC)
A major panic that occurs at the end of a steep decline in prices. In its classical form it is typified by large range reversal in prices accompanied by large volume.
Automatic Rally (AR)
The rally that occurs after a Selling Climax. It occurs without previous preparation, hence the word “automatic.” The top of an AR usually marks the beginning of the coming creek.
Secondary Test (ST)
A name given by Wyckoff to the reaction following Automatic Rally, (or rally following the Automatic reaction.) If that test is associated with small range and light volume—it increases the likelihood that the previous trend is over.
Spring
A form of a test of a trading range. Characterized by pushing prices below support by the CM in order to check the status of supply. The market’s response to the spring indicates the nature of supply and demand forces for the near future.
Comment
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Fase B of Wyckoff started in Nov 11, Early on in Phase B, the price swings tend to be wide and accompanied by high volume. As the professionals absorb the supply, however, the volume on downswings within the TR tends to diminish.
ST—secondary test, in which price revisits the area of the SC to test the supply/demand balance at these levels. If a bottom is to be confirmed, volume and price spread should be significantly diminished as the market approaches support in the area of the SC. It is common to have multiple STs after a SC.
Look how volume is decreasing, earnings report is coming, could be the potential break of SC level and rejection.