Is the three consecutive positive lines on the weekly line but the decreasing volume a sign of weak growth?

Three consecutive green weekly candles with declining volume may signal weak buying pressure and potential price reversals despite short-term gains.

Jun 20, 2025 at 02:21 am

Understanding the Weekly Chart Pattern

When analyzing cryptocurrency price movements, weekly charts are often used by long-term investors and traders to identify significant trends. A pattern of three consecutive positive lines on the weekly chart typically suggests that the asset has been in an uptrend over a period of three weeks. Each green or bullish candlestick indicates that the closing price for that week is higher than the opening price.

However, this particular scenario introduces a complication: volume is decreasing during these upward moves. Volume is a crucial indicator because it reflects the strength behind price movements. Normally, rising prices should be accompanied by increasing volume, which signals strong buying interest. When prices go up but volume declines, it raises questions about the sustainability of the rally.

Three consecutive positive lines may suggest accumulation or sustained buying pressure. Yet if volume is declining, it could imply that fewer participants are driving the price higher.

The Role of Volume in Confirming Price Action

Volume plays a vital role in confirming whether a price move is genuine or potentially deceptive. In technical analysis, a rising market with increasing volume is seen as healthy, whereas a rising market with shrinking volume can be interpreted as weak or lacking conviction.

In the context of the weekly chart:

• Rising prices with falling volume may indicate that large players (whales) are manipulating the price without broad support from retail traders.
• It might also mean that buyers are entering the market but in smaller numbers each week, suggesting diminishing enthusiasm.
• In some cases, such patterns precede a correction or consolidation phase where the market pauses to absorb the gains made during the previous weeks.

This divergence between price and volume is often considered a red flag by experienced analysts.

How This Pattern Manifests in Cryptocurrency Markets

Cryptocurrency markets are known for their volatility and speculative nature. Patterns like three consecutive green candles with decreasing volume can occur more frequently due to the influence of social sentiment, whale activity, and algorithmic trading.

For example:

• If a major influencer tweets positively about a coin, it may trigger short-term buying without substantial fundamental backing, leading to price increases on low volume.
• Similarly, pump-and-dump schemes often show similar behavior where coordinated buying pushes the price up temporarily while volume doesn’t reflect organic demand.
• Market makers may also manipulate volume by creating artificial trades that give the illusion of momentum without real market depth.

These behaviors distort normal market signals and require extra caution when interpreting technical indicators.

Historical Examples and Case Studies

Looking at historical data from major cryptocurrencies like Bitcoin and Ethereum, there have been several instances where bullish price action was not supported by volume. For instance:

• In early 2021, Bitcoin showed multiple weekly candles with rising closes but declining volume before entering a correction phase.
• Ethereum exhibited similar patterns in late 2022 after a brief rebound, where price rose slightly but volume failed to confirm the move.

Analyzing such examples reveals that these setups often precede sideways movement or pullbacks rather than continued bullish momentum.

Moreover, altcoins tend to display exaggerated versions of this behavior due to lower liquidity and higher speculation. It’s not uncommon for lesser-known tokens to spike on very low volume, misleading inexperienced traders into thinking a new trend is forming.

What Should Traders Do in Such Scenarios?

Traders who encounter this pattern need to approach cautiously. Here are some actionable steps:

• Wait for confirmation – Don’t assume the uptrend will continue just because price is rising. Look for volume to pick up again before entering long positions.
• Use additional indicators – Incorporate tools like RSI, MACD, or On-Balance Volume (OBV) to cross-validate whether the trend is sustainable.
• Set tight stop losses – If you do decide to trade the pattern, manage risk carefully since reversals can be sharp.
• Monitor order books and depth – Understanding the liquidity behind price changes can provide clues about whether the move is legitimate.

Ultimately, this pattern should not be viewed in isolation but as part of a broader analytical framework.

Frequently Asked Questions

Can three green weekly candles still lead to a bull run even with low volume?

Yes, in rare cases, especially if the asset is undergoing a fundamental shift (like a protocol upgrade or major adoption), low-volume rallies can precede larger moves. However, such scenarios are exceptions rather than the rule.

Is it possible for whales to cause this pattern intentionally?

Absolutely. Large holders or institutional entities can push price upwards without corresponding volume by placing strategic buy orders, especially in less liquid markets.

Should I sell my holdings if I see this pattern?

Not necessarily. If your investment strategy is long-term and fundamentals remain strong, short-term technical patterns shouldn’t dictate decisions. However, for active traders, it may serve as a warning sign.

Does this pattern apply equally to all cryptocurrencies?

No. The significance of this pattern tends to be stronger in larger, more established cryptocurrencies like Bitcoin and Ethereum. In highly speculative altcoins, such patterns can appear frequently and may not carry the same weight.