Accelerating Up & Accelerating Down

The main characteristic of this Volume-Price chart pattern is advancing price on increasing volume.

Mechanics behind Accelerating Up

Price moving up on increasing volume means that the Bulls are stronger than the Bears (advancing price) and their Bullish buying pressure is increasing (increasing volume).

As price moves up, either it runs into stop losses of the Bears or selling orders (to pocket profit) of the shorter-term Bullish traders and it lead to increase in Supply (selling pressure). As Supply increases, so does the Demand increases. The Bulls absorb all increasing supply which leads to increase in volume. I addition the Bulls continue to create extra Demand which pushes the price up.

What we have to see and what should we expect:

In most cases, when Accelerating Up pattern is witnessed, price continues to move up for as long as we see increase in volume. Bullish momentum is very strong. Further price action depends on what happen before.

• This volume-price chart pattern is mostly seen at the end of the side-way range trading as price is breaking up. In this case the odds are good that the "Smart Money" finished the Accumulation phase and they are ready to break up and start a new up-trend.
• Also, an Accelerating Up pattern could be seen at the second bottom of Double Bottom chart pattern, or at the third bottom of the Triple Bottom chart patter. The same as after side-way trending, in this case, an Acceleration Up pattern may indicate the end of the Accumulation phase when the Smart Money decided to break up.
• When an Accelerating Up chart pattern is noted after down-trend, usually, it is a result of action of shorter-term Bullish sentiment. In this case, as volume starts to decline, you have to be ready for price sliding back into down-trend.
• When an Accelerating Up chart pattern is noted after up-trend, it could be a sign of a begging of a Distribution phase when Smart Monet starts to dump their investments. In this case price may enter a side-way range trading as volume starts to decline.

This pattern is opposite to the Accelerating Up chart pattern described above - Accelerating Down chart pattern is witnessed when we have declining price on rising volume.

Mechanics behind Accelerating Down

When price moves down on increasing volume it means that the Bears are stronger than the Bulls (declining price) and their Bearish selling pressure is increasing (increasing volume).

As price declines it runs into increasing  Bullish pressure (increasing Demand), however, the Bearish pressure (Supply) goes up as well. The increasing Supply absorb all increasing Demand (which lead to increase in volume) and continues to push price lower. The Bearish momentum is strong.

What we have to see

When Accelerating Down pattern is witnessed, price continues to decline for as long as we see increase in volume. Bearish momentum is very strong. However, further price action depends on what happened before.

• This volume-price chart pattern could be seen at the end of the side-way range trading. In this case the odds are good that the "Smart Money" finished the Distribution phase and they are ready to break down.
• Also, an Accelerating Down pattern could be seen at the second top of Double To chart pattern, or at the third top of the Triple Top chart patter. The same as after side-way trending, in this case, an Acceleration Down pattern may indicate the end of the Distribution phase when the Smart Money decided to break down.
• When an Accelerating down chart pattern is noted after up-trend, usually, it is a result of action of shorter-term bearish sentiment. In this case, it could be just a correction within longer-term up-trend. As volume starts to decline, you have to be ready for price bouncing back into an up-trend.
• When an Accelerating Up chart pattern is noted after down-trend, it could be a sign of a begging of an Accumulation phase when Smart Monet starts to accumulate low price shares. In this case price may enter a side-way volatile range as volume starts to decline. Also, price may continue crashing down until strong volume surges are generated.