Market StructureAdvanced#Classic T.A.#Phases
Wyckoff Theory
W
Definition
A methodology for identifying market phases: Accumulation, Markup, Distribution, and Markdown.
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Concept Diagram
Key Takeaways
1
Wyckoff Theory identifies market phases through accumulation, markup, distribution, and markdown
2
Accumulation happens when smart money quietly buys from weak hands during a trading range
3
Distribution occurs when smart money sells to retail traders near the top of a markup phase
4
Spring and UTAD patterns identify the final shakeout before major moves begin
Practical Example
After BTC drops from $69K to $30K, it enters a Wyckoff Accumulation phase ranging between $30-35K for months. A Spring below $29K shakes out weak hands, then price rallies to $45K confirming the markup phase has begun.
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Related Terms
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Market Structure Break (MSB)When price breaks the previous valid high/low, signaling a potential shift in the primary market trend.
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Change of Character (CHoCH)The first sign of an internal trend shift on low timeframes, often occurring before a major high-timeframe trend reversal.
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Liquidity GrabA engineered move to trigger stop losses above/below obvious levels to fill institutional buy/sell orders.
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Power of 3 (PO3)A market cycle concept consisting of three distinct phases: Accumulation, Manipulation, and Distribution.
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