every day trader knows that the main
push of whatever market movement is
happening is due to banks and financial
institutions and big money the retail
trader cannot affect the market as the
big banks can a lot of you guys have
been requesting this video so i'm going
to try to do a extremely short video
explaining how banks trade and the
entire wyckoff method
[Music]
welcome back to the channel everybody my
name's artie and this is the moving
average a show where we discuss
everything day trading to keep you
profitable on a consistent basis okay
now if you are not a intermediate or
advanced trader please just click away
from this video this is extremely
advanced stuff and you need to learn the
basics before you get into this that's
why i've been waiting for over 100
videos to make this it's
it's not the easiest thing the wyckoff
principal or wyckoff method
um actually let's just get into the
charts and i'm going to show you what
i'm talking about so there are four main
parts of the y-cof method the first part
is the law of supply and demand when
demand is greater than the supply the
price will rise then when the supply is
greater than the demand the price will
fall and one of the tools that you can
use to identify this is volume bars so
for example in an area like this you can
see that the price was going flat yet
volume is massive same thing right here
price is flat yet volume is spiking i
will get into that a little bit later
the second part to the wyckoff method is
the law of cause and effect the two
examples put forth in the wyckoff method
is a period of accumulation moves into
an uptrend the cause and the effect and
a period of distribution moves into a
downtrend
cause and effect so for example this
would be a period of accumulation
causing the uptrend and this would be a
period of distribution which will
probably end up in a downtrend as it did
here as well as here now the third part
is the law of effort and result this is
where we're going to look at the volume
bars in conjunction with price action so
the first example that i showed you
right here was this period of
accumulation accumulation is basically
consolidation on the bottom end so we
had this big move down
a slow moving period of accumulation
this consolidation phase and yet you
could see in this area when the price
was dropping the volume was relatively
growing and you know getting there
now in this period where the price
action is flat you see this massive
amount of volume that's the effort and
result that this theory is pointing to
that in these zones there's massive
amounts of volume so this is basically
like a divergence price is flat yet
volume is high
versus when it's in confluence with each
other you know you get that nice smooth
movement down or up these are the areas
you need to look out for i get asked all
the time how do you know if price is
consolidating it's because it's flat and
volume is massively high that's how you
know the fourth part of the wyckoff
method is known as the composite man um
basically this is wyckoff's way of
saying that the market is pushed by an
evil entity the man the banks the
manipulators
and this allows you to think of the
market manipulator as a bad guy and you
know how he moves the market to screw
over the retail trader and how you can
actually get on board with him so you
guys probably want to know how to trade
this there are four stages to the whole
wyckoff thing and there's multiple i'm
going to get into like a more in-depth
video if you want to see that if you
actually do want to see that let me know
in the comment section down below but
i'm going to try to make this video
super short because every y cough video
is like an hour and a half long okay if
we fine tune this area of consolidation
you can see that once price started
going flat volume started to rise and
then we got this spike out of this range
and then it broke out this spike out of
the range is the trap that literally
like the people that got stuck here
really really got screwed and this is
what the composite man does he
traps traitors right here this is the
false breakout that i was talking about
in previous videos this is known as the
spring in the wyckoff method and it's
usually in an area of consolidation
which is on the bottom end known as a
period of accumulation with high volume
spikes and then it breaks out of that
range and that's when you can go in for
a long position so
when the price is accumulating after a
long downtrend this is why you want to
enter your trade at the top of this
range and not worry about these
breakouts keep the breakouts in your
mind and think of them as springs these
are the massive traps so look for the
breakout of these ranges with massive
volume and then you should start looking
for a long position once it breaks out
of that range after the accumulation
phase which is the first phase of the
wyckoff method the next one is the mark
up which is right here it breaks out of
that range moves up that's the markup
the next phase is distribution it's
another phase of consolidation but this
is on the high end and while
distribution is going you should be
looking for your positions to go short
so again you get this area of
consolidation with high spikes in volume
and then you get the spring out another
high spike in volume followed by a drop
in the price in the market this is known
as the mark down now this is an
extremely basic way to look at it the
whole wyckoff theory is extremely deep
and it can be broken down like way way
way more than what i'm doing right here
but i just want to give you a general
sense of price action supply and demand
and the white cough theory just to recap
we have a period of accumulation with
high volume spikes
followed by the mark up the uptrend once
that uptrend is exhausted we fall into a
period of distribution another
consolidation range with high volume
spikes and you need to keep an eye out
for the springs the breaks out of those
ranges those are the signals that once
those happen then you start looking for
your entry to go short after a period of
distribution and to go long after a
period of accumulation now also just to
clarify what the composite man does the
market manipulator he right here
is buying up a few positions not to
really you know make the market go crazy
but just to like build up his his long
position so he buys and buys and buys
every time he's at the bottom of this
range right here and then the last push
down is caused by the composite man and
then they start really taking off same
thing goes on the opposite end there's a
cell there's a cell and then there's a
big push off cell while the retail
trader is buying up he is slowly selling
off and then causing the mark down phase
now again if you guys want another
in-depth video explaining the entire
like breakdown of the accumulation phase
and the entire like series of events
that happens in each one of these phases
to get the laser entries let me know in
the comment section down below it goes
you know phase a phase b all the way to
phase e breaking the support and
resistance lines like this is
really really in-depth advanced stuff
so i just wanted to give you a breakdown
of the wyckoff theory and the why cough
method and how it works and how supply
and demand works so if you guys enjoyed
this video i'd really appreciate a big
fat thumbs up really helps out with the
youtube algorithm helps promote my
videos more and it helps the channel
grow so it's your thank you to me for
giving you this information for free and
if you guys have been in this situation
where you've been caught in the spring
and uh you know you've made those
mistakes check out this video that i did
on the top 10 mistakes that most retail
day traders make and if you guys want to
see more videos like this make sure
you're subscribed to the channel by
clicking this button right here thanks
so much for watching and we'll see you
in the next video