Some plausible hopium for your Sunday night incoming. It's...

Some plausible hopium for your Sunday night incoming.

It's possible that we're in a Wyckoff Accumulation range right now as I'll outline below. Note that I've charted using Heikin Ashi as it paints a clearer picture on this. I've drawn roughly what you'd expect to see from here if we are in an accumulation range:



Phase A:

Selling Climax (SC) formed by an intense selling activity as investors capitulate. Strong drop quickly reverts into a bounce or Automatic Rally (AR)

Secondary Test (ST) happens when the market heads back near the SC region as a test confirming whether the downtrend is really over or not. Trading volume should be noticeably lower. Often the ST will form a higher low than SC but this isn't imperative.

Phase B:

'The Cause that leads to an Effect' - essentially, Phase B is consolidation where Smart Money is accumulating again. There may be multiple ST's during Phase B with the potential for higher highs and lower lows in relation to SC and AR from Phase A.

Phase C:

The Spring - essentially the Bear Trap before moving toward higher lows. The Spring should trigger stop losses from people who have entered during Phase A and B lows. Smart Money back at it again faking out retailers like us making us think we're heading low keeping us on the side before moving up. Note that a Spring won't always occur during Accumulation.

Phase D:

'The transition between the Cause and Effect' - expect an increase in trading volume and volatility. Usually a Last Point Support (LPS) making a higher low before the market moves higher. The LPS often precedes a breakout of resistance levels which creates higher highs. This is an indication of Signs of Strength (SOS) as previous resistance becomes support.

Phase E:

Evident breakout of the trading range, caused by increased market demand. The trading range is effectively broken, and the uptrend begins.

Wouldn't mind some support on the idea at https://www.tradingview.com/chart/BOT/JNobuCR2-BOT-Wyckoff-Accumulation-Schematic/ - also, if you want to follow to see how the idea plays out here we go.