One of the lessons we all have to learn as volume price analysis traders, is the patience required once a strong signal appears. In this example the early warning signal is extreme volume which heralds some weakness in the bullish trend higher. This is not an immediate signal to sell, but a sign that the market makers are struggling here, driving the market higher and into a market that is becoming unresponsive to higher prices. The analogy here is the car moving up an icy hill, with more power applied to the accelerator simply resulting in the wheels spinning ever faster. So the early warning appears first, and then this is followed by further confirming signals denoted with the deep wicks to the upper bodies of several candles which then follow on good volume, with the pair finally rolling over and into a steep bearish trend in due course.
The take away message here is patience – be patient and take note of these early warning signals and do not expect the market to react instantly. It takes time to ’empty the warehouse’, and once done, the next phase of the campaign then begins.