What Is the Wyckoff Method, in Plain Words

A range at the bottom, read in steps

The Wyckoff method is a way of reading a range. The Dow — the index of thirty large American companies, quoted in points — fell from 45,105 on 4 December 2024 to 42,008 on 20 December, the low Wyckoff would call the climax. It bounced to 43,302 on 26 December. It came back to test the low at 42,071 on 2 January. On 13 January it dipped under the range to 41,639 and closed back inside it: the spring. On 22 January it left the range upward, and by 31 January it was at 45,012. The method names those turns and expects them in that order.

One big fish

The picture is one big fish among many small ones. Wyckoff, writing in the 1920s, asked readers to imagine every market as one composite buyer and seller: a single large player who fills up at the bottom, taking what small sellers offer a little at a time so that the price barely moves, and who empties out at the top the same way. Nobody sees the big fish. The method is the reading of its footprints in a range — the climax, the bounce, the test, the spring, the leaving — as the marks of one player filling up.

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