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Demand confirmation · Advanced playbook

Test After Spring Playbook

A checklist for judging whether the market has successfully tested supply after a spring.

A checklist for judging whether the market has successfully tested supply after a spring.

CategoryDemand confirmation
DifficultyAdvanced
Checklist typeEvidence-led
Risk framingRequired

Professional use note

This playbook is a structured educational checklist. It is not a trading signal, recommendation, or guarantee. Use it only with provenance-labelled charts, alternative scenarios, and risk-first planning.

Definition

A test after spring asks whether sellers remain active after the market returns into the range. The strongest test usually shows reduced spread, reduced volume, limited downside result, and a demand response.

Best context

  • A spring or shakeout thesis already exists.
  • The market has reclaimed the range or returned above the spring reference.
  • The test occurs after demand response, not before spring confirmation.
  • The test is close enough to the danger zone to reveal supply.

Required evidence

  • Volume contracts versus the spring and prior selling waves.
  • Spread narrows or result lower is poor.
  • Close is off the low or the next bar responds.
  • Price does not easily revisit the spring low.
  • The test improves risk definition.

Decision checklist

What must be true before the playbook is useful?

  1. 1

    Map the background before naming a pattern.

  2. 2

    List the demand evidence and the supply evidence separately.

  3. 3

    Compare volume, spread, close and follow-through.

  4. 4

    Write the preferred thesis and the strongest alternative.

  5. 5

    Define confirmation and invalidation before any decision.

  6. 6

    Accept “unclear” when evidence is mixed.

Confirmation checklist

  • Reduced volume on the test.
  • Refusal to continue lower.
  • Next bar closes firm or demand appears.
  • Risk point can be tightened under test/support.

Invalidation signs

  • Test bar expands down on rising volume.
  • Next bar breaks the test low with result.
  • The reclaim never occurred.
  • The test is too far above the spring to prove much.

Common traps

  • Assuming low volume is always bullish.
  • Treating a pause as a test without a prior spring thesis.
  • Ignoring a failed test.
  • Chasing after the response is already extended.

Risk warning

A test improves information, not certainty. Risk must remain modest and invalidation must be respected if renewed supply appears.

Practice task

Apply the playbook before you trade the idea.

Find five post-spring pullbacks. Grade each as strong test, weak test, failed test, or unclear, and write the bar that would invalidate your grade.

Source notes

These sources inform the vocabulary, structural framing, and risk discipline. The playbook itself is an educational operating checklist, not financial advice.