[ETHUSDT] Wyckoff Redistribution and Vector Volume Analysis
The current Ethereum chart presents a classic illustration of a potential Wyckoff redistribution phase, enriched with insights from high volume vector candles indicative of market maker presence—a strategy used by Traders Reality. I am not affiliated with Traders Reality, but do implement their strategies in my trading. You can check out their information at the links below.
Deciphering Wyckoff's Redistribution with Vector Volumes:
Redistribution can often be hidden as a pause or market consolidation after a significant uptrend, yet it frequently foreshadows an impending downtrend, marked by distinct phases often with manipulation from activities of market makers. Let's check out the subphases below.
1. Preliminary Supply (PS): An initial increase in volume and price stalling indicates that supply is entering the market, possibly from market makers starting to offload positions.
2. Selling Climax (SCLMX): A dramatic sell-off, often marked by a high volume vector candle, suggesting that market makers are inducing retail traders to panic sell, only to buy back at lower prices.
3. Automatic Rally (AR): The reflexive bounce after the climax, usually on lower volume, indicating a temporary lull in market maker activity. This rally is observed by market makers, to test interest of retail buyers.
4. Sign of Weakness (SOW): A dip below the AR's support, with a high volume vector candle indicating a resurgence of market maker selling pressure.
5. Secondary Test or Upthrust (ST/UT): In some cases, a Secondary Test is replaced by an Upthrust—a rally to new highs on high volume, which fails and falls back, signaling a trap by market makers. ST- A retest of the AR's high on reduced volume; this is where the absence of high volume vector candles may suggest a lack of genuine demand.
6. Second Sign of Weakness (SOW): Further attempts to push down, validated by high volume vectors, confirm the sellers' market dominance.
7. Upthrust After Distribution (UTAD): Often coming after an ST or UT, the UTAD is a final push up, potentially marked by high volume vectors, where market makers aim to trap optimistic buyers before a widespread markdown.
8. Last Point of Supply (LPSY): The concluding phase of the distribution cycle, usually lacking significant volume vectors, indicating the final exhaustion of demand.
High Volume Vectors: Market Maker Clues:
The abnormally high volume vector candles serve as breadcrumbs left by market makers. These vectors, particularly when they appear at crucial junctures like an ST or UT, can be powerful indicators of a looming reversal, as they reflect aggressive trading contrary to retail sentiment.
Examining the Latest ETH Chart:
Our updated ETH chart shows a notable ST or Upthrust (UT), identified by a high volume vector candle that pierces previous highs but fails to sustain. This pattern suggest the potential for a redistribution phase as it suggests a lack of genuine buying pressure behind the move, possibly orchestrated by market makers.
Conclusion:
This technical breakdown integrates Wyckoff's redistribution phases with the strategic movements of market makers, as revealed by vector volume analysis. This dual approach offers traders a comprehensive lens to interpret and navigate ETH's market structure.
Tradersreality.com
www.youtube.com/@TradersReality
**Disclaimer:** This post is for educational purposes and is not intended as investment advice. Trading in cryptocurrencies carries significant risk. Do your due diligence, and consult with a financial advisor before engaging in any trading activities.
Deciphering Wyckoff's Redistribution with Vector Volumes:
Redistribution can often be hidden as a pause or market consolidation after a significant uptrend, yet it frequently foreshadows an impending downtrend, marked by distinct phases often with manipulation from activities of market makers. Let's check out the subphases below.
1. Preliminary Supply (PS): An initial increase in volume and price stalling indicates that supply is entering the market, possibly from market makers starting to offload positions.
2. Selling Climax (SCLMX): A dramatic sell-off, often marked by a high volume vector candle, suggesting that market makers are inducing retail traders to panic sell, only to buy back at lower prices.
3. Automatic Rally (AR): The reflexive bounce after the climax, usually on lower volume, indicating a temporary lull in market maker activity. This rally is observed by market makers, to test interest of retail buyers.
4. Sign of Weakness (SOW): A dip below the AR's support, with a high volume vector candle indicating a resurgence of market maker selling pressure.
5. Secondary Test or Upthrust (ST/UT): In some cases, a Secondary Test is replaced by an Upthrust—a rally to new highs on high volume, which fails and falls back, signaling a trap by market makers. ST- A retest of the AR's high on reduced volume; this is where the absence of high volume vector candles may suggest a lack of genuine demand.
6. Second Sign of Weakness (SOW): Further attempts to push down, validated by high volume vectors, confirm the sellers' market dominance.
7. Upthrust After Distribution (UTAD): Often coming after an ST or UT, the UTAD is a final push up, potentially marked by high volume vectors, where market makers aim to trap optimistic buyers before a widespread markdown.
8. Last Point of Supply (LPSY): The concluding phase of the distribution cycle, usually lacking significant volume vectors, indicating the final exhaustion of demand.
High Volume Vectors: Market Maker Clues:
The abnormally high volume vector candles serve as breadcrumbs left by market makers. These vectors, particularly when they appear at crucial junctures like an ST or UT, can be powerful indicators of a looming reversal, as they reflect aggressive trading contrary to retail sentiment.
Examining the Latest ETH Chart:
Our updated ETH chart shows a notable ST or Upthrust (UT), identified by a high volume vector candle that pierces previous highs but fails to sustain. This pattern suggest the potential for a redistribution phase as it suggests a lack of genuine buying pressure behind the move, possibly orchestrated by market makers.
Conclusion:
This technical breakdown integrates Wyckoff's redistribution phases with the strategic movements of market makers, as revealed by vector volume analysis. This dual approach offers traders a comprehensive lens to interpret and navigate ETH's market structure.
Tradersreality.com
www.youtube.com/@TradersReality
**Disclaimer:** This post is for educational purposes and is not intended as investment advice. Trading in cryptocurrencies carries significant risk. Do your due diligence, and consult with a financial advisor before engaging in any trading activities.