Wyckoff Analysis, developed by Richard Wyckoff in the 1930s, is a professional-grade methodology that reads the tape to identify institutional accumulation and distribution via price-volume patterns. It focuses on phases of market movement: accumulation, markup, distribution, and markdown.
Key Use: Identify institutional flow and major trend changes before retail traders.
1. Accumulation
Smart money quietly buying; price range-bound; large volume on down bars.
2. Markup
Price rises sharply; volume increases; trend becomes obvious.
3. Distribution
Smart money exits quietly; price consolidates; volume drops then spikes.
4. Markdown
Price falls sharply; panic selling begins; opportunity for new accumulation.
Price-Volume Divergence: Price up but volume down = weakness ahead
Spring: Quick dip below support during accumulation, then recovery
Upthrust: Quick spike above resistance during distribution, then failure
VTLA (Volume, Time, Leverage, Attitude): Comprehensive market analysis framework
✓ Advantages
⚠ Limitations