Basic Wyckoff Scheme of Accumulation - RWM

ACCUMULATION: The process by which large operators absorb available stock

from the market. This is a transfer FROM retail traders (‘weak hands’) to strong
traders (‘strong hands’)

THE CREEK: Resistance level for accumulation or reaccumulation structure. It is established by

the maximum generated by the Automatic Rally and by the maximums that can be developed
during PHASE B.
CHoCH. Change of Character. It indicates the environment in which the price will move soon.
The first CHoCH is established in PHASE A where the price will move soon. The first CHoCH is
established in PHASE A where the price moves from a downward trend to a consolidation
environment. The second CHoCH is set from the minimum of PHASE C to the maximum of
SOS in which the price moves from a consolidation environment to an upward trend
environment.

PHASE A - This area is where the previous bearish trend ends, and the accumulation process truely
begins.
PS: Preliminary Support. It’s the first attempt to stop the downward movement, that will
always fail.
SC: Selling Climax. Climate action that stops the downward movement.

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 AR: Automatic Rally. The bullish reaction. An upward movement that sets the maximum
range.
ST: Secondary Test. Test of the level of supply in relation to climate action. Establishes the
end of PHASE A and the beginning of PHASE B.

PHASE B - The construction of the cause

UA: Upthrust Action. Temporary breakout of the resistance and re-entry in the the trading
range. This is a test at the maximum generated by the AR.
ST as SOW: Secondary Test as Sign of Weakness. Sample of weakness in test function.
Temporary break of the support and re-entry to the range. This is a test at the minimum
generated by the SC

PHASE C - The Test

SP: Spring. It is a test in the form of breakout of the minimums of PHASE A and B. There
are three different types of Springs
Test Spring. Downward movement towards lows of the range in order to check the
commitment of the sellers.
LPS. Last Point of Support. Test in the form of a bearish movement that fails to reach
the minimum range.
TSO. Terminal Shakeout (or The Shakeout). Abrupt movement of minimum breakout
that produce a deep penetration of the level of support, and with a fast recovery.

PHASE D - Bullish trend within the trading range.

SOS or JAC. Sign of Strength or Jump Across the Creek (“Creek Jump”). Bullish
movement generated after the PHASE C test event that manages to reach the top of the
range.
LPS. Last Point of Support. These are the rising troughs we find in the upward
movement towards resistance.
BU / BUEC. Back Up, or Back Up to the Edge of the Creek.

PHASE E - The bullish trend out of the trading range. Demonstration of higher highs and
higher lows. Eventually leading into the next Distribution Scheme.