Wyckoff Trading Strategies: Introduction to Wyckoff Articles

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Two Goals, Three Laws & Five Steps

Two Goals, Three Laws and Five Steps Applying the Wyckoff approach to stock market trading can be complicated due to the many variations in the manner in which stock market action can unfold.  However, the foundation upon which the method is built is quite simple.  The foundation of the Wyckoff method consists of two goals,

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Step One of the Wyckoff Method

Stock Market Trading Strategies Step One of the Wyckoff Method In the Wyckoff Course, Wyckoff teaches that the most important thing anyone can know about a market or an individual issue is its trend and the position that it occupies in the trend. The trend is the line of least resistance. It indicates the direction in which

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Step Two of the Wyckoff Method

Stock Market Trading Strategies Step Two of the Wyckoff Method Step two of the Wyckoff method is very simple, but yet so very important in achieving consistent success in the market.  Wyckoff teaches us to always trade stocks that are in harmony with the market. The trend of the market as indicated by the Wyckoff Wave

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The Wyckoff Method Step 3

Step Three of the Wyckoff Method Step three of the Wyckoff method is intended to help traders avoid marginal trades. Wyckoff teaches us to select only those issues that have built a cause.  A cause can be defined in more than one way. In step three, Wyckoff is referring to the use of a figure chart

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The Wyckoff Method Step 4

Step Four of the Wyckoff Method In step four of the Wyckoff Method, Wyckoff tells us to determine a stocks readiness to move.  Taking a position in an issue that has not or has not nearly completed it preparation for its next move  is wasteful and dangerous.  It is wasteful in that funds committed to

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The Wyckoff Method Step 5

Step 5 of the Wyckoff Method The final step of the Wyckoff method is the one that actually results in a position being established.  Wyckoff tells us to time trades in individual issues to anticipated trends in the general market.  While it is true that there are always individual issues that make substantial moves in

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Analyzing Trends Using the Wyckoff Method

Analyzing Trends Using the Wyckoff Method  Wyckoff tells us that the most important thing that anyone can know about the market or an individual issue is its trend. The trend is most simply defined as being the line of least resistance. Prices will tend to follow the line of least resistance until there is a

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Price and Volume Relationships

Price and Volume Relationships Wyckoff tells us that the most important thing that can be known about the action of a market or an issue is its trend. Step one of the Wyckoff Method indicates that the position of the action relative to the trend is also an important piece of knowledge. A third essential

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Figure Charts, Counts and Counting

Figure Charts, Counts and Counting An important part of the Wyckoff approach is the use of figure charts. Figure charts are a tool that Wyckoff traders can use to compress the action of the market or an individual issue to provide a perspective that may not be effectively provided by a bar chart. They provide

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Directional Indicators and Timing Tools

Directional Indicators and Timing Tools Wyckoff traders have several tools that can help them determine the direction in which the market or an individual issue is likely to move and the likelihood of a change in that direction. These tools are the Optimism-Pessimism Index (O. P.), Technometer (Tec) and the Force. They are all derived