The Wyckoff Methodology in Depth

TradingWyckoff.com was born with the objective of spreading knowledge about financial markets

Rubén Villahermosa
Rubén Villahermosa

Quantitative Operator under the ideas of Wyckoff Methodology

What is the Wyckoff Methodology?

The Wyckoff Methodology is a technical analysis approach to operating in the financial markets based on the study of the relationship between supply and demand forces.

The approach is simple: When large traders want to buy or sell they carry out processes that leave their mark and can be seen in the charts through price and volume.

Wyckoff’s methodology is based on identifying that professional intervention to try to elucidate who is in control of the market in order to trade alongside them.

What is it based on? What makes it different from other approaches?

The main advantage that puts this methodology above the rest is that it is based on solid principles; it has a real underlying logic.

Far from all kinds of indicators, it focuses on the study of the interaction between supply and demand; which, as we know, is the driving force behind all financial markets.

What will you learn?

▶ How markets move. The market is formed by movements in waves that develop trends and cycles.

▶ The 3 fundamental laws. The only discretionary method that has an underlying logic behind it.

  1. The law of Supply and Demand.
  2. The law of Cause and Effect.
  3. The law of Effort and Result.

▶ The processes of accumulation and distribution. The development of structures that identify the actions of great professionals.

▶ The events and phases of the Wyckoff Methodology. The key actions of the market that will allow us to make judicious analyses.

▶ Operation. We combine context, structures and operational areas to position ourselves on the side of the large operators.

Interesting, isn’t it? I encourage you then to watch this video where I introduce the key concepts of the methodology

If you want to study this method of analysis further, you can do so through my book:

Table of contents

Chapter 1 – Waves

Chapter 2 – The price cycle

Chapter 3 – Trends

Types of trends

 

Chapter 4 – Trends assessment

Strength/weakness analysis

Speed

Projection

Depth

Lines

Horizontal lines

Trend lines

Channels

Inverted lines

Converging lines

 

Chapter 5 – Trading Ranges

Chapter 6 – Wyckoff Methodology Structures

Basic scheme of accumulation #1

Basic scheme of accumulacion #2

Basic scheme of distribution #1

Basic scheme of distribution #2

Chapter 7 – The law of supply and demand

Theory

Price shift

Initiative

Lack of interest

 

Chapter 8 – The Law of Cause and Effect

Elements to bear in mind

Point and Figure Charts

Technical analysis for projection of objectives

 

Chapter 9 – The Law of Effort and Result

The importance of volume

Harmony and divergence

In the development of a candle

On the next scroll

In the development of the movements

By Waves

By reaching key levels

Effort/Result in Trends

Lack of interest

Chapter 10 – Accumulation

Stock control

The law of cause and effect

Handling maneuvers

Counterparty, liquidity

The path of least resistance

Common characteristics of the accumulation trading ranges

Beginning of the bullish movement

 

Chapter 11 – Reaccumulation

Stock Absorption

Duration of the structure

Reaccumulation or Distribution

 

Chapter 12 – Distribution

The law of cause and effect

Handling maneuvers

Counterparty, liquidity

The path of least resistance

Common characteristics of the distribution trading ranges

Beginning of the Bearish Movement

 

Chapter 13 – Redistribution

Redistribution or accumulation

Stock control

Duration of the structure

Chapter 14 – Event #1: Stop

Preliminary Support

The Psychology Behind Preliminary Support

Potential Preliminary Support

Uses of Preliminary Support

Preliminary Supply

The Psychology Behind Preliminary Supply

Potential Preliminary Supply

Uses of Preliminary Supply

 

Chapter 15 – Event #2: Climax

Selling Climax

Keys to Selling Climax

How it appears on the graph

The psychology behind the Selling Climax

The Selling Climax of exhaustion

Uses of Selling Climax

 

Chapter 16 – Event #3: Reaction

Automatic Rally

The change of character (ChoCh)

Why the Automatic Rally takes place

Uses of the Automatic Rally

The implications of its development

The anatomy of the Automatic Rally

 

Chapter 17 – Event #4: Test

Secondary Test

Functions of the Secondary Test

Secondary Test Features

The Secondary Tests of Phase B

Secondary Test on the upper end

Secondary Test on the lower end

The generic test

Where to look for tests

Test after shock

Test after breakout

Trend test

How the Test appears on the chart

The difference between the Secondary Test and the Generic Test

 

Chapter 18 – Event #5: Shaking

Spring/Shakeout

Spring Functions

Addition game 0

Behavior

Types of Spring

The Ordinary Shakeout

The Spring test

 

Chapter 19 – Event #6: Breakout

Change of Character

How it appears on the graph

The breakout without volume

Keys to the breakout event

Breakout does not offer an opportunity

Sign of Strength

Minor SOS

Sign Of Strength Bar

Sign of Weakness

minor SOW

Sign Of Weakness Bar

Chapter 20 – Event 7: Confirmation

How the confirmation appears on the graph

Warning signal after breakout

Operational Opportunity

Quantify the entry trigger

Last Point of Support

Last Point of Supply

Chapter 21 – Phase A: Stopping the previous trend

Chapter 22 – Phase B: Building the Cause

Chapter 23 – Phase C: Test

Chapter 24 – Phase D. Trend within range

Chapter 25 – Phase E. Trend out of range

  1. The context
  2. The structures
  3. Operational areas

Chapter 26 – Primary positions

In Phase C

In Phase D

In Phase E

Chapter 27 – Decision-making

The concept of the significant bar

The concept of reversal of movement

Position Management 

S&P500 Index ($ES)

Pound/Dollar cross ($6B)

Euro/Dollar cross ($6E)

Bitcoin (BTCUSDT)

Inditex (ITX)

Google (GOOGL)

Australian Dollar/US Dollar cross ($6A)

Completely exclusive images

You can purchase the content in different formats:

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PDF

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eBook

22$

Paperback

Customer Reviews

"Great book for anyone that wants to understand the basic lessons of Wyckoff. I am a full-time trader and even though I have read previous books about the Wyckoff Method, its good to see someone like Ruben really streamline the concepts into a more concise book with no fluff. A good refresher for those familiar with Wyckoff or as a primer for someone looking to get started in trading. Other reviewers what to focus on misspelling or other factors (font size, PDF versions, etc) but it misses the point of just being able to understand the laws of trading. In the end, a misspelling is not going to make you money in the market, being able to execute on rules and concepts is..."
E. D. Santiago
"The author did a great job of summarizing the difficult Wyckoff material and succeeded in putting it in a more easily digestible and understandable format. I have been learning about the Wyckoff method on and off for a few years and this book is going to be of great help in my learning journey and as a reference in the coming years. Granted that the Wyckoff Method is not a mechanical, rule-based trading methodology, but rather a discretionary method, relying on traders being able to do a good job in analysing the market, this book is one of the best ways to procure a big-picture, comprehensive understanding that would form the foundation of successful Wyckoff trading. I had no problem with viewing the material on Kindle - for those who do, the author's website sells a PDF of the same book which you can zoom in in your PDF reader. So highly recommended."
Ad
"Truly enjoyed reading this book. Writing in simple to understand way, yet comprehensive in scope. Begins with a brief primer in demand and supply and order flow and delves into the anatomy of the base/consolidations. This was further dissected into it's component parts as relevant to Wyckoff's methodology . Each of those components are then microscopically examined at the molecular level to bring into focus a clear understanding of price/volume dynamics in the financial markets which lend itself into the interpretations behind the motives of the actions of professional money makers. Well done. Highly recommended."
Cyril
"I have been studying technical analysis for three years and counting. This is a very important piece of the puzzle for me, helps me understand what really is behind accumulation/distribution and how it works. I've read about it in other books but this finally explains it in great detail with detailed graphs / drawings. I will have to practice and read charts and then get back to the book again be able to fully absorb everything. This is a gem for any investor. Buy it!"
Book gobbler
"I have read many books on the Wyckoff method, but this is the first that breaks each stage down into such clarity, explaining the reasons each step happens, what it tells you and what to look for next. Do not skip the first section on How Markets Move, like I nearly did, thinking this was basic stuff I already knew. There are some interesting points rather than the usual "look for higher highs and higher lows". Unless you are an advanced practitioner, am sure you will learn something in this section. i am currently reading the book a second time for anything I have missed the first time. I very rarely do that. This book is now in the top ten in my library and is the best value money I have spent while learning Wyckoff, definitely a lot better value than some expensive courses some people are offering!"
Stephen Randall
"In my experience, most books on trading methodology are either: (a) esoteric tomes written by mathematicians following a statistical approach that ignores human psychology and the influence of smart money/big money/operators; or, (b) ridiculously simplistic 124-pg books that just give you a trading algorithm without a detailed, from-the-ground-up, explanation. The former are only readable by math graduates and have questionable value because of their complete lack of consideration of the human factor. And the latter, whilst accessible to the person on the street, set you up to fail because they do not give you a comprehensive grounding in the market and the forces that drive price: things like market order volumes, limit order density, the effect of open orders, supply and demand, and the strategies of the smart money/operators - so when things get rough and you need to modify your approach, you are lost at sea because you simply don't have enough background knowledge. I've been studying the fundamentals of price action relentlessly over the last year. Of course, I heard of Wyckoff and his ideas made broad sense and looked promising, but everyone that I read could only discuss his teaching sketchily - no authors appear to have a deep understanding, so I had shelved Wyckoff's theories. Then I found "The Wyckoff Methodology in Depth". Imo this book is a game-changer. Incredibly detailed - And accessible to the person on the street. If you're an 'instant gratification monkey', do not read this book; instead buy any of the hundreds of short sketchy 'do this and you will win' books on the market. If you are a serious student of trading, buy "The Wyckoff Methodology in Depth". You won't regret it."
Daniella Gordon
"I'm no beginner to the Wyckoff way of seeing the markets and I've also read all the resources the author references. I also have many hours of practice with Wyckoff. I was struck by the extreme clarity Ruben writes with. It sharpened up my glasses even more. If someone is planning to learn to trade, this is the first book they should read. Books, courses, audios, they won't get you there, just as books, courses or audio wont make you play violin like Mozart. That requires practice. But this is the finest material, that I highly recommend you to digest. Even if you're very advance with Wyckoff because of the extreme clarity Ruben is coming from."
Alchemista
"Unless they are system 1 functions of the brain, doing anything well is hard and it needs effort. Technical analysis is not something you can just pick up, study a bit, and get to do well right away. It needs a lot of time and effort, not just in study but in practice and following experience. If you understand this and if you're willing to put in the time and effort to learn the Wyckoff methodology seriously, then this is the book. The author goes through the concepts of the method in a lot of detail, over and over again. He lays out the structure of the book and then goes over each subject one by one, then once again into detail by subject - I like the structure. By the time you're finished with the book you've probably looked back at the previous pages multiple times to check what was said before about the same topic as it resurfaces, but I like the structure as it gives the reader plenty of time to think and rethink and get used to the concept. More practical examples would have been further appreciated but the author seems to be preparing a follow up book so hopefully my hopes will be fulfilled when the next edition is released. Some minor typos here and there and small fonts in some charts are a dent for the book, but nothing major."
Joseph Park
"So many "aha" moments reading this book .... if I had read it when I first started trading 5 years ago, I would have been a looooong way further along than I am, and probably richer too. Now I can start to understand why movements happen. Each element is broken down and explained fully with supporting diagrams. This is one of the reasons its so good. Designed for all levels of reader. Already read it twice and my trading charts look very different now that I have a much better idea of whats is going on and who's doing it. Cant wait for the 2nd book.... want it now now now !!!!"
David Austin