As this is something we've discussed live extensively during streams, I wanted to take a moment to outline a "live" setup for Wyckoff Redistribution. In this instance, the target is Litecoin ($LTC). First let's discuss what Wyckoff Redistribution actually is, starting with a link to the pattern itself.
Wyckoff Redistribution is a way to truly make sense of what's happening with particular assets. As many already know, trading is hard! What makes it especially hard is the trickiness that happens so tricky. Many times our emotions will tell us to "buy" or that things "FEEL bullish" right before a big selloff. Viewing things in the context of Wyckoff helps us strip away the constant smoke & mirrors & determine what's truly going on.
Here are the key steps & triggers as I see them (Note: ORDER MATTERS):
1) Identify a sustained downtrend (usually -30% or greater)
2) Identify a period of time where price appears to go sideways on the macro time frame (daily candles, with downtrend and sideways each lasting months)
3) Identify the formation of key horizontal(s) where price keeps selling off consistently (short stops & long triggers are being built here).
* This is often the trade range highs.
4) Identify a LACK of lows being run.
* Running the lows is a BULLISH indicator, whereas NOT running lows is BEARISH. Redistribution is BEARISH.
5) After sustained consolidation, watch for the before mentioned horizontals to be BROKEN.
* This is what gets shorts to close and longs to pile on, as a trick.
6) After the breakout, watch for price to close BACK under the key horizontal identified previously.
* Breaking back into the range, rather than consolidating at the highs, is a key difference between the UTAD of Wyckoff Redistribution & the "SOS" consolidation of Wyckoff Acummulation.
7) At this point, your sell/short entries trigger & the anticipated price drop is from the failed breakout horizontal down to the range lows.
* The stops here would be back above the range highs
8) After this move, the market often rallies off the lows in some bearish form (dead cat, Rising Wedge, H&S, etc) where it then falls below the range lows as it heads downward toward its next target.
This concludes the lesson on trading Wyckoff Redistribution. If you have any questions or suggestions, feel free to reach out to me via socials. GL
Wyckoff Redistribution is a way to truly make sense of what's happening with particular assets. As many already know, trading is hard! What makes it especially hard is the trickiness that happens so tricky. Many times our emotions will tell us to "buy" or that things "FEEL bullish" right before a big selloff. Viewing things in the context of Wyckoff helps us strip away the constant smoke & mirrors & determine what's truly going on.
Here are the key steps & triggers as I see them (Note: ORDER MATTERS):
1) Identify a sustained downtrend (usually -30% or greater)
2) Identify a period of time where price appears to go sideways on the macro time frame (daily candles, with downtrend and sideways each lasting months)
3) Identify the formation of key horizontal(s) where price keeps selling off consistently (short stops & long triggers are being built here).
* This is often the trade range highs.
4) Identify a LACK of lows being run.
* Running the lows is a BULLISH indicator, whereas NOT running lows is BEARISH. Redistribution is BEARISH.
5) After sustained consolidation, watch for the before mentioned horizontals to be BROKEN.
* This is what gets shorts to close and longs to pile on, as a trick.
6) After the breakout, watch for price to close BACK under the key horizontal identified previously.
* Breaking back into the range, rather than consolidating at the highs, is a key difference between the UTAD of Wyckoff Redistribution & the "SOS" consolidation of Wyckoff Acummulation.
7) At this point, your sell/short entries trigger & the anticipated price drop is from the failed breakout horizontal down to the range lows.
* The stops here would be back above the range highs
8) After this move, the market often rallies off the lows in some bearish form (dead cat, Rising Wedge, H&S, etc) where it then falls below the range lows as it heads downward toward its next target.
This concludes the lesson on trading Wyckoff Redistribution. If you have any questions or suggestions, feel free to reach out to me via socials. GL
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