When can we short after a volume spike, and when is it not advisable to do so? This should be the most concerning question for most investors. In the case where the trading volume reaches a spike, if the price has significantly risen in the previous period, ideally after three waves of price increase, and the price on the 15-minute chart retreats from a high, then the signal to short is very clear. Thus, we should consider shorting when a reversal pattern appears on the 15-minute chart. For example, when the price on the 15-minute chart breaks below the moving average, the formation of a volume spike at the top on the 15-minute chart is an important indicator for a short position.

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It is not difficult to see that the price has been continuously rising, accompanied by a volume spike leading to a peak price. At this point, it is completely feasible to enter a short position after the completion of the five-wave structure in the market, especially when a peak price and volume spike occur. How to operate? Simply from the candlestick chart, if the price can break below the 30-day moving average, we can take the break of the 30-day moving average as a basis to enter a short position. Moreover, if on the 15-minute chart, the price can break below the moving average, then it is even more advisable to short; the alignment with the 15-minute chart will greatly increase the chances of success for this short entry.