Wyckoff Accumulation and Distribution
Wyckoff schematics map the events inside accumulation and distribution ranges, from selling climax to spring. Learn each event, the phases and how to trade them.
Wyckoff's accumulation and distribution schematics describe the typical sequence of events inside a trading range at the bottom or top of a market. They give names to each test, climax and false break, and group them into phases labelled A to E. Real markets rarely match the schematic perfectly, but knowing the sequence helps you recognise where you might be inside a range and which events matter most.
Accumulation events#
| Event | Name | What happens |
|---|---|---|
| PS | Preliminary support | First significant buying after a long decline; the fall slows |
| SC | Selling climax | Panic selling on very heavy volume, often a wide range bar, absorbed by large buyers |
| AR | Automatic rally | A sharp bounce as selling exhausts; its high marks the range top |
| ST | Secondary test | Price revisits the SC area on lower volume, testing whether supply is exhausted |
| Spring | Spring (or shakeout) | Price dips below the range low, triggering stops, then quickly recovers |
| Test | Test of the spring | A lighter volume pullback that holds above the spring low |
| SOS | Sign of strength | A strong rally on rising volume, often breaking the range top |
| LPS | Last point of support | A pullback after the SOS that holds above former resistance, a key entry |
| BU | Backup | A retest of the range top from above before markup |
The phases#
| Phase | Purpose |
|---|---|
| A | Stopping the prior downtrend: PS, SC, AR, ST |
| B | Building the cause: the range develops as large players accumulate |
| C | Testing: the spring tests remaining supply |
| D | Demand dominates: SOS, LPS |
| E | Markup: price leaves the range and trends higher |
The spring: the key event#
The spring is the moment many traders watch most closely. Price falls below the bottom of the range, triggering stop losses and attracting short sellers, then quickly rallies back inside. If it recovers on increasing volume and the follow up test holds on lighter volume, supply has been exhausted. In modern terms, the spring is a liquidity sweep. See Liquidity Sweeps and Stop Hunts.
Distribution: the mirror image#
Distribution follows the same logic at a top:
| Accumulation event | Distribution equivalent |
|---|---|
| Selling climax (SC) | Buying climax (BC) |
| Automatic rally (AR) | Automatic reaction (AR), a sharp drop |
| Spring | Upthrust after distribution (UTAD), a false breakout above the range |
| Sign of strength (SOS) | Sign of weakness (SOW), a strong drop breaking the range low |
| Last point of support (LPS) | Last point of supply (LPSY), a weak rally that fails |
How traders use the schematics#
- Identify the range after a strong trend and look for climax events on heavy volume.
- Be patient during phase B, when price chops sideways with no clear edge.
- Watch for the spring or upthrust in phase C as the potential turning point.
- Enter on the test or the LPS, which offers a defined stop with confirmation.
- Use the range width to estimate the potential move, following the cause and effect law. See Wyckoff Method.
Not every range follows the script#
Many accumulation ranges have no clear spring; price simply strengthens and breaks out. Some apparent accumulations turn out to be re-accumulation within a downtrend that continues lower. Treat the schematic as a vocabulary for describing what you see, not as a forecast that must play out. Volume behaviour and confirmation matter more than labels. See Volume Analysis Basics.
Common mistakes#
- Forcing every range into the schematic.
- Buying the selling climax without waiting for tests and structure.
- Mistaking a breakdown for a spring; a spring must recover quickly back into the range.
Frequently asked questions#
What is Wyckoff accumulation?#
A trading range after a decline where large participants gradually buy, described by a sequence of events such as the selling climax, spring and sign of strength.
What is a Wyckoff spring?#
A brief drop below the trading range low that triggers stops and then quickly recovers, signalling that remaining supply has been absorbed.
What is UTAD in Wyckoff distribution?#
Upthrust after distribution: a false breakout above a distribution range that fails and precedes a decline.
Next, move to the Risk and Psychology area, starting with Position Sizing.
Sources#
- Wikipedia, Richard Wyckoff
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Mentioned in
- Accumulation/DistributionVolume Analysis