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weak high

A weak high should not be confused with a poor high. The latter speaks to a deficiency in structure and the former deals with the location of the high. A weak high is formed when a market rises and reverses right at a specific point which is often a technical or profile nuance. Some examples would be prior intraday highs, the upper extreme of a value area, the prior day’s settlement, or the current day’s open. In each case, the location is a mechanical and visual reference that is used by short term traders as an entry point. The high is deemed weak because it can be taken easily when retested due to the short term nature of the sellers who initiated their positions at that level.