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)

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Customer Reviews (from Spanish version)

The Wyckoff Methodology in Depth