Original subtitles

Hello, everyone. Today is January 7th, and this is the first session of the

Wyckoff Trading Course.

We're going to have 15 sessions, and it's always exciting to start the new

cycle, to meet new people, new traders, new Wyckoffians that are coming into our

new universe and becoming part of our community, and we welcome you.

And for those of you who are guests, Just for this session, please enjoy this

session. If you have any questions, email me. Go to our website.

Browse through our products, offerings, free offerings.

Maybe you decide to attend other classes.

And if you have questions about the course, I will be happy to answer those

either via email or today. You could always ask the question just typing it

So for those of you who already signed up, for this session.

There are two groups of people, actually three groups of people for this session

that we are having today.

The first one is students who already signed up and you are new students.

You haven't taken this course before, so I will be addressing you in a specific

way. I will be

Throughout this whole lecture, I will be giving you certain instructions as to

what am I expecting from you a week from now. We'll talk about the homework.

We'll talk about some books that I'm going to recommend, some additional

material that I want you to read or to view.

And the second group is the alumni.

students who have gone through the course and they come back just because

there's so much material and just to absorb all of this material in one set

could be a little bit hard.

And I had so many great comments from alumni when they take the

course for the second time and obviously would give you guys a discount.

So for those of you who are alumni, if you feel that you need to refresh your

knowledge. And obviously, from each cycle to another cycle, I hope that I'm

improving the material, adding to the material, or explaining it in a

way.

So hopefully, that's going to be helpful. And the third group is guests.

So again, for those of you who are guests, welcome.

And I'm so happy that you're here.

Our Wyckoff Price Structure Series, the beginning, the first four sessions,

starting with today's session. I'm going to continue until January 14th, 21st,

and 28th. We're going to meet at 3 p .m. Pacific. For those of you who know me,

I'm extremely bad with time management just because I want to give you guys a

lot of the stuff.

And sometimes we kind of spill over just a regular 5 o 'clock

Indian for the class. So this cycle, and this is the new innovation, I decided

that officially we're going to have the class for two and a half hours from 3 p

.m. to 5 .30 p .m. Pacific.

And as you know, those who attended these classes before, sometimes we go to

'clock as well.

Sometimes I feel like we need to finish the exercise or we need to finish a

lecture and we'll do that. So I would say that, you know, keep like three

for the live session and obviously you don't have to stay through the whole

session if you need to go. It's all understandable.

And, you know, if you...

are unable to attend a live session, or we have so many international students

that live across the globe.

For those of you who live outside of the U .S.

or, you know, this continent and this time zone,

all of our sessions are recorded, and I post them each evening after the class.

And usually, you know, the latest by the next morning, you're going to have the

video from the last class and the slides as well.

For those of you who are guests to register for this course, go to our

ycafanalytics .com. You could find the course either on the homepage or...

Just browse through the website and find the correct pages. Sign up. We have a

discounted price right now at $9 .98.

That will last probably until January 14th, and that is for the 15

webinar or recorded sessions.

All of the recordings and slides will be available to you guys who signed up for

this class.

This particular session will be posted on YouTube channel. So right away,

make a note of this right here at the bottom, left bottom on the

slide. I'm posting an announcement that we are recording this session and it

will be on YouTube.

If not tonight, then by tomorrow morning. And again, if you need to go,

know, just keep this in mind and you can watch it at your convenience.

A really quick announcement for students who already signed up for this course.

There is a specific way how I want to receive your homework, and

we've been doing this for over 15 cycles now, and

I think even more, maybe more than 20 cycles.

I want you to submit your homework just in one file.

I don't need to receive multiple files from you with all of the charts.

Please combine those into one file.

And my preference is always PowerPoint or the PDF or the Word

doc format.

And obviously, I want to see your first name. You don't have to put your last

name. And you could mention what number of the homework.

It is. I save all of your homework. I go through all of them. I review all of

them. And the reason why I do this is because I need to understand what kind

mistakes we're making as a group, what kind of commonality we have among us in

the way how we view the instructions, the material, and so on and so forth.

And I'll talk about this more as I will explain next week's homework for

you guys.

And the last announcement, and this is extremely important for those of you who

signed up.

Our classes are extremely interactive.

The first class is the only class that is a lecture.

Everything else is a class where I'm going to be lecturing,

and then I'm going to open up the mic to either a specific student or to

everybody, and everybody could comment.

And as we go through the exercise, I will converse with you. So this means

I would like you to have a microphone available to you.

Usually I recommend a headset with the built -in microphone.

That works the best. That's what I'm using.

And, you know, as alumni might tell you or other students from other classes,

there is a lot of interaction that happens in this class. The reason why I

interact with students is because I want to understand how you think and what is

the issue in your analysis.

And it's throughout the conversation that the truth kind of comes out and

easier for me to teach that way.

And it's been like this for years and years, so that's a very common thing for

us to do.

All right, so we're done with this.

Let's look at, and obviously everything that we're discussing today in this

lecture is for educational purposes only. You can stop the recording and

the whole disclaimer.

What are we going to look at today?

So today, as usual in this first class, I'm going to show you some examples of

my trades.

Yes, I do trade, and I teach, and I teach what I trade.

I trade, my predominant time frame is a swing time frame, and there are a couple

of distinctions there that I usually have, either very short swing trades

couple of days to a week or so.

or swing trades that last for months.

And then I also started doing, in the last two years, a lot of campaign

So I'm going to show you some of those trades as well. And obviously this is

just something to highlight the method, the analysis, the execution,

the tactics.

I'm also a person who is...

extremely honest with my students and I show my mistakes and I think that I need

to I want to be in the space of you know honesty with my

students I want you guys to show me your mistakes and I'll show you mine and

together we we're going to learn from that we're going to analyze we're going

post analyze we're going to figure out what is it that we're doing right or

wrong

So this is the type of relationship that I usually build with my students. So

today we're going to look at four traits, two of them on the short

side and two of them on the long side.

Some of them were great traits, some of them were good traits, and some of them

were bad traits.

So we're going to look at where mistakes were made.

Also, and this is something that... I usually don't do in this class a lot,

whenever the market is extremely active, I tend to discuss the market almost in

each class just because I know how difficult it is to be exposed to the

market. And then when something happens, you know.

Obviously, students have questions, and I'm bombarded with emails.

You know, what do you think? What's happening? Could you look at this and

And I will talk also about the Wyckoff Market discussion class that we conduct

on Wednesdays.

Currently, we have a promotion. I'll mention that.

So I think it's appropriate today very quickly go through the market analysis.

Then after that, we're going to do the course overview.

I'm just going to touch on the main subjects that we're going to cover in

four series.

And then after that, we're going to start with the actual course.

We're going to start with the introduction to the Wyckoff method.

about Richard Wyckoff himself.

We'll define what composite operator means to us. We'll talk about the price

cycle, which is a predominant framework for us.

And then we'll start with the main structural concepts, which is a change

character and then the traits of the accumulation and the distribution.

And obviously, this is just an introduction.

This is something that I'm just giving to you guys to maybe even

think about what's coming next and to think about the

benefits.

of this knowledge and how you could apply this knowledge in your trading.

then we'll definitely look at the homework.

Next session, for those of you who already signed up or who are planning to

up, we're going to go into the details of the price structural analysis.

First, we'll review the homework.

And by the way, the most common question from students who signed up was,

obviously about the recordings, so you will have the recordings almost

instantly.

And then the second most common question was, can I email you a question and ask

you if I don't understand something?

You can definitely do so, but my preference is to look at your question

answer to the question during the session.

There is a...

much more value for me and for students in the class if I answer your question

in the next class.

And obviously, I want this question to be related to the content that we are

discussing at the time. So any questions that might be covering some material

that is ahead, I'm just going to say we're going to study this later on.

Or I'm going to say keep this question for session number 15, which is going to

be a Q &A session for us. And then some of the questions that does not

require me to write a lot, I might just, you know, quickly write an answer.

But predominantly we will be answering and looking at those questions during

next class.

We'll talk in session two about...

reaccumulation and redistribution within the structure of the price cycle.

Some distinctions there, some labeling distinctions.

And the biggest question here on the reaccumulation and the redistribution

let's say with the reaccumulation, is this a reaccumulation or a distribution?

And the market obviously gave us such a puzzle in 2018.

And I think that puzzle is still unfolding, by the way. By no means that

we are out of this formation yet. It just still keeps unfolding.

But we'll talk about the traits of the reaccumulation and the distribution,

distinctions between reaccumulation and distribution,

distinctions in labeling, and so on and so forth.

And then after that, we're going to go into the details on the price structural

analysis where we will discuss how to identify the phase boundaries, you know,

and we'll talk about the phase analysis, why do we need that, and we'll talk

about this today a little bit.

We'll talk about phase C identification. For those of you who are familiar with

Y -graph methodology, phase C is kind of like a very crucial phase in the price

structure.

That structural phase C, we'll talk about types of sprints and shakeouts.

are specific price action that we identify. They happen in a specific way,

want to be able to identify those and develop the skill to recognize those

as they happen.

We'll talk about the sign of strength, and that is...

beyond phase C, going into the next phase D.

So in sign of strength, it's going to act as a change of character.

And that's session number two.

Each session will have some kind of homework.

So one of the things with students from each of the cycles that I've conducted

was that the course is too intense and that it

requires, you know, definitely time to follow the course.

And unfortunately, I have only marginally

valuable answers to these comments to you guys.

I think it's always the pace of a specific student that I'm discussing.

If somebody has time...

and you are very serious about this knowledge and you want to get it as soon

possible, then yes, you have to do your homework each week.

And if you skip it, then make sure that you come back, you do it, you send it to

me, and then you watch the video with the review or at least you have some

of questions.

If you don't have a lot of time, to do the homework, then I think the best

assignment for you is just to make sure that you just go through the video.

And as you go through the video and you watch it, I want you to make some

notes. And those don't have to be very extensive notes. I just want you to kind

of like stop the video, think about the concepts, write those down, write those

concepts in your own words.

And that would be the best thing. This way, you are acquiring the knowledge.

are absorbing the knowledge. And during this course, I will be repeating

concepts over and over and over and over again.

Because that's how our minds work.

Our minds are, you know, and especially if you, as

myself, not that young, you know, it takes time.

to go through some of the concepts, and there's nothing wrong in that. We just

need to repeat them over and over.

So as you could already maybe see, I'm extremely passionate about this

material, trading in general, Wyckoff Method in general, and my students as

well. I like to see the progress.

I like to push you guys. So I kind of have a tendency to be a little bit, you

know, kind of...

pushing you to the limits that you allow me, you know, to push you.

And I think, you know, that's one of the values of this course. And I've heard

these comments before from students that they appreciate my teaching style and I

appreciate that comment and, you know, the fact that a lot of them just come

back.

But that's the intensity and that's the style that I have.

And again, if you feel that that's a little bit too much, it doesn't mean

you don't...

You don't have to take the course.

Take the course, but go at your own pace.

You could always, you know, buy the course and then go and watch the

at your own pace.

Send me homework.

Send me questions.

Maybe come to the live session if you want.

I would actually do both if you have time, live session and then watch the

recording again.

Again, this session is being recorded.

and I will post it on our Wyckoff Trigging Method channel on YouTube.

By the way, check it out. We have quite a few videos now, and almost each week

there is some kind of update. There is some kind of upload of a new video.

So check out our channel. And, you know, for those of you who want to sign up,

Go to our website.

Currently, the price is still a discounted price, so make sure that you

before it goes up.

All right, so let's start with the first case study. And the first case study,

well, because, you know, there's such a bearish sentiment right now, and

obviously, rightfully so, we have had low highs, lower lows, a conventional T8

definition.

of a downtrend so obviously you know i wanted to look at the at trades that

done that were on the downside so we'll look at nova tier and we'll look at

russell 2000 and here are these two traits first let's look at nova d

so nova deer was a very interesting uh case study and i think that

um

It probably requires more time to spend on this and

to fully understand how and at what point our bias is

changing and at what point tactically we would be going in into this position

and establishing a short position.

And again, guys, I'm extremely...

honest with you as to what I thought or what my trades were at one point or

another. So as the price was still making higher highs and higher lows, my

bias was still to the upside.

And in a lot of cases here in this trading range, you would see the benefit

that. Obviously, Navadir was such a big leadership stock in this

business cycle that we've had.

It was one of the best stocks to have for a companion.

It was one of the best swing stocks as well.

So there was nothing wrong here, in my opinion, in this trading range, to still

have a bias to the upside. Because if you're a swing trader, you're going to

initiate your positions close to the support.

And then whenever they fail, that's when you want to get out of those positions.

So even in this upsloping trading range with higher highs, higher lows, you

could manage being maybe not entirely

right on the long -term buys, but be right on the short -term buys and still

extract some money out of this.

Also, please note, that because of the leadership characteristics, because of

the strength that this particular stock and the group, you know, semi

-conducting group, has exhibited for years in this business cycle, the

distribution does not necessarily look like a distribution.

If you look at the first initial reaction that starts with the buying

after the climactic run, which we identify in this course as the first

excitement,

Look at the initial reaction.

It happens on three, four days down, very quick sell -off, but then a very

run -up to the same highs.

So what does it tell us?

Someone's selling, but somebody's still buying.

Some institutions are still seeing some value in the stock.

So at this point of time, we're just noticing this price action, price

development, and we're saying that there was a change of character in the way

how the price...

was going down on peak volume signature and how it quickly recovered.

And at this point of time, we would be thinking that we're going to develop a

trading range.

That's our logic at that time. We know that we're in the potential phase A,

which should show us a buying climax, automatic reaction, and secondary test.

So all of these three points are here in phase A. So again, at this point of

time, you might be thinking this could be a reaccumulation.

And that's exactly the point of view that I had when

the market made a high at the end of January and had a very sharp

reaction into the February low.

Novodea looked very good.

It looked much, much better than the market itself.

So this is a natural tendency for us to get to the stock and to

select the stock.

that has those leadership characteristics during the times of

Then I'm not going to go through phase B. There are some points that we could

talk about, like a minor sign of weakness here, attempts to upthrust the

the texture of the price and the volume signature that suggests that there is no

supply at this point of time. And that suggests a rally, which does happen. And

it happens in very...

familiar way of how some of the rallies in the Tragen range developed.

And as we are reacting to one half of the range and on the next

rally, we are attempting to overcome the point of upsloping resistance.

We see that there is only a temporary commitment to the upside.

There is only one bar, one close that is above the previous high.

and then the price just quickly fails back into the trading range.

So therefore, the question here is, why would this happen?

If the stock is so strong, why is it failing on the breakout?

And we obviously could see that as the price goes back into the trading range,

there is a gap, there is a downspread that is increasing, and also

supply is increasing.

Those are all elements of potential institutional selling. So we want to

sure that we are not necessarily shorting a leadership stock right away.

There were so many other stocks to short before that, even before October and

September, that were already in the downtrend. If you look at some of the

stocks, even if we look at Russell, look at the September action.

compared to other indices and other stocks, you could see

that stocks in Russell 2000 have been exhibiting already the weakness.

So on the first leg to the downside, this is where you have to be. You have

be in the weaker asset.

But as I was actually conducting...

a presentation for StockCharts .com on MarketWatchers Live, I actually had this

position. And I've entered this position on the second leg to the downside. This

was the actual bar where I initiated this position.

And this type of the positions I always conduct with options trading.

So I just bought directional options with

and I have to look it up a little bit better, what was the expiration.

But usually for this type of short -term trades, I would have the expiration a

month or two away.

I'm expecting a drop to the downside, and I'll explain in a second why.

But first, let's talk about the timing. Let's talk about the selection.

How do we transition from a leadership stock into the stock that is for sale?

and into the stock that we could short with confidence.

Well, this whole move right here, look what happens here.

It's a change of character.

The stock is starting to behave in a different way.

We're seeing multiple gaps at the open.

We're seeing how the downspread is increasing.

And comparing this move to the previous moves to the downside in the same

trading range, this is probably the most aggressive move to the downside.

Not only that, look at the distance that it traveled.

This is the largest distance to the downside in this trading range.

So if they sell, they actually progress to the downside.

we will be discussing in the second portion of the course the relationship

between volume and price, or as we would identify

it in different terms, the relationship between effort and the result.

So we've seen for the first time that all of the attempts to push the price

in the trading range were unsuccessful.

And for the first time, not only the distance...

um that of the reaction has increased and the character with which it moves

also we're seeing the increase of the supply signature or rather increase of

downward effort and it's being synchronized with the downward result

and that's what we're looking for

in the selection of the stock that has concluded some kind of formation and now

shows to us that institutions are selling at this point.

So that was the determining factor for the selection of this trade. Everything

else was kind of very much mechanical, you know, because tactics are tactics.

They're not going to change.

We're identifying the first leg to the downside as a sign of weakness.

And then look at the rally.

A very weak rally.

It cannot even come back to one half of the trading range.

And then it just fails.

So the position was opened on this bar right at the open

after the price went through the previous low.

And it was an enjoyable trade just because it happened so fast.

So from about $236 to $188, that's about what?

So almost like $50.

And it happens so quick.

One, two, three, four, five, six, seven days, seven trading days. So a

week and a half.

And let's see, if you are a swing trader and a short -term swing trader, this is

a very quick profit.

And also think about the leverage, right? So I'm putting on puts options.

So I'm definitely leveraging this position.

Now, the reason for closing the position was that we have made a low,

low below the low of the automatic reaction.

clearly in the oversold condition here.

The volume signature is not that climactic, but we're anticipating that

point, we might have some kind of stopping action.

Why? Well, because selling does not happen consistently.

There is always some kind of institutions that are going to find some

the price moves to the downside.

Because if they are holding their position and they are thinking, well,

here was a leadership, even in this climate, I'd rather hold on to this

because it's a leadership stock.

Then at some point, as the price goes to below the point of where they bought or

they thought that there is some value, they're going to step in and they're

going to stop buying. And we see that from the volume signature.

So a lot of the conversations that we're going to have throughout this course is

going to be about.

institutional sentiment.

Where do they find value and where do they find liquidity?

Those are the two things that institutions require in order for us to,

they require in order for them to open the position.

So increasing the volume signature suggests increasing the institutional

activity.

And we see that there was a move to the upside.

So some of them were biased at this point.

There was no reason for me to wait for a potential trading range to develop.

That was the thought at the time. So the exit was just at the close.

And initially, I thought that my analysis was correct.

And I thought that after the selling climax and automatic rally, we had a

secondary test and we are in phase A and we're going to continue a trading range

until the next leg to the downside as a continuation.

Unfortunately, it didn't happen that way.

The price just tanked and it tanked on the institutional capitulation. This is

where institutions are just giving up their positions.

And we must say that there is a difference between a strong hand or a

hand. There is institutions that are acting at this point of time as strong

hands and some institutions are acting as weak hands.

So obviously, capitulation happens on the selling of weak institutional hands.

And then some of the strong hands are seeing that there is some, again, some

value that was not there for them at 190, 180, but they've seen some value at

150,

140, 130. So they are stepping in and they are stopping the price from moving

further down by initiating their buy positions.

So that was a relatively easy and quick trade.

emotionally very stable because the price basically drops.

And that's how it usually happens during the bear market.

And I really enjoy actually shorting.

It's just that we haven't had an opportunity to short for quite some

don't mean just short, you know, specific stocks, but market in general.

Talking about the market.

as we are continuing with the development of the bearish sentiment.

In this area right here, I had quite a few calls to the upside, and I'm

totally okay with that.

There are two things that you have to remember.

It's all about the context of where we are and how we trade.

And the context here is that As we have already established, let's say,

a bias to the downside, it doesn't mean that there are no trades to the

upside that we could exploit, even on a short -term basis.

So as the market was going down in the second leg right here, we could see that

the supply is actually being exhausted.

my call here was to the upside.

And I still stand by that. And I thought that was a great call because the call

was just for a swing trade or for the rally to happen. And actually it happens

couple of times actually on other markets, on other

indices that was even better.

So I'm going to show you some of the trades in this area right here if you're

swing trader and how to exploit that.

But in this case,

A continuation happened after a failed sprint.

And we'll talk about the sprint and the definition of the sprint later on, guys,

so don't worry about that.

But it acted as a failed signal.

And a failed signal is probably the best signal in technical analysis that you

could find.

Why, Bill? Because usually a failed signal will have a very quick

shift in the sentiment.

where the majority of traders were on the wrong side of the trade.

And then as they close out their positions, either via stop loss or

capitulation, that produces a big counter move to the sentiment that

that. And we kind of see that it happened exactly this way. Well, first

we are coming out of the apex formation.

So here we're thinking that the velocity is going to increase on the way down.

you know if uh if the sprint fails and as it fails it gives us a very very uh

great tactical place to open the position which obviously i took

um and uh not necessarily was the best exit right here

and you know i think that further down the road we could discuss this whether

the wake of trading course or in the practicum

But I still felt that it was much better than not to be

exposed to the market at the time when the bias was so bearish. That's number

one. Secondly, at the time, I had some long positions, which were campaign

positions or even swing positions, and I wanted to hedge.

So one of the ways to do that is exactly this.

You know, you could hedge through opening the position, let's say, against

of the positions that you have with the different bars, and that was the idea,

and it worked out somewhat okay, somewhat perfectly. I'm just kind of

more about the exit here. My preference would be to exit a little bit lower

right here on this close. Why? Well, because this bar

shows on the volume signature.

climactic action.

So this was more truer selling climax characteristic

than on the previous bar.

And the reason why I was thinking now I'm remembering this is just the close.

Close that had a little bit of the uplift and that we didn't really

before that.

So I remember that was the thinking.

Also, look at the oversold condition right here. Even this bar, the exit bar,

has been already in the oversold condition.

And so therefore, and the volume signature was relatively high.

It was one of the highest that we have had. And if we use the analog

of how the price actually stopped here, there was a suggestion that somewhere

here there might be a stop in action.

So that was the logic.

but definitely could have been a little bit better as an exit.

So these are the couple of trades that I've

conducted during this bear market.

But as I've mentioned, there were some trades that I had on the long side, and

definitely

I want to acknowledge that. That's number one. I want to explain the logic.

want you guys to understand the logic. So we'll go through that, and hopefully

after this post -analysis, you kind of would get a feel of, first, how I trade,

secondly, what I teach, and thirdly and more importantly, how could we use

Wyckoff methodology to define the selection and to define the tactics for

A question here from Eric. After the sign of weakness to the exit at 188, is

better not to operate? Was that the question,

Eric?

Okay, after the sign of weakness to the exit of 188.

Okay, better not to operate?

I don't know. It worked out, right? So I think what happened here is that

institutions started to sell.

And there was not a lot of selling, actually. If you think about, you know,

this move to the downside, what it had in terms of the force to the downside,

could see the increase in the supply signature. But if we would compare it to

the previous attempts, you know, to sell off, it actually was

less of a force to the downside. Yet,

look at how quickly we're moving to the downside.

So it means that there is no resistance for the price to stop at some point and

to react to the upside.

There are no bias at this point. So that was the logic of the continuation.

Okay, and Eric, hopefully I understood your question. If not, you could just

react. Let's look at the next case study.

And this one is Canadian Solar.

This particular stock I have been stocking for some time.

And I'm going to go through the analysis first to the point of entry so that you

would understand the logic of why I'm in this position.

I'm still currently in this position.

This is a campaign position, meaning that I'm going to hold on to this

for quite some time. I want to...

I want this position to develop into a sustainable uptrend where not only this

stock, but the group itself and the peers are going to confirm that we are

in the campaign mode.

And it all starts with phase A, where we see the final climactic action

with increased spread, gaps to the downside, huge volume signature.

That represents both increase of the supply and increase of the demand.

Increase of the supply from weak hands and increase of the demand from strong

hands. And I will teach you how to identify those two categories of traders

on the price action and the volume action.

And then multiple tests, which I'm putting into phase A.

And then phase B was very interesting.

The whole selection for this trade was based on phase B. And somebody might be

thinking, who knows Wyckoff methodology, what the heck? What is he talking

about? How could you define a selection based on

phase B?

Well, look at where phase B is residing.

It's residing on the top of phase A.

and early phase B, also on the top of the potential

preliminary support, which happens before the climactic action.

What does it tell you?

Well, it tells us one thing, that the institutions bought in into this

and then they didn't want to get rid of it.

And the shakeout has...

specific characteristics that we will study and this shakeout happens so fast

it doesn't produce a lower low relative to the climactic action

it's actually a high low and look how quickly there is after the capitulation

which is still institutional capitulation they are thinking in terms

quarters so multiple quarters The stock is not showing absolute return,

and the stock is not showing relative return.

What are they going to do if the stock starts to go down? They will get rid of

it.

They will get rid of the stock from their portfolios, and this is exactly

volume signature and the price behavior that tells us that story.

So out of this, we have a relatively quick recovery, which tells us that This

was just an kind of institutional short -term capitulation where

a lot of other institutions actually picked up all of their shares.

And we're seeing multiple tests. By itself, this low is a test to the

lows in phases A and early B. Then multiple local tests.

And my point of entry actually was right here.

So what am I seeing here?

Well, I'm thinking that from this point on, we're probably going to just go up

into a potential sign of strength, into phase D, meaning that we're expecting

the price to overcome all of the levels of the previous resistance.

And then it doesn't happen right away. There is a smaller shakeout. And one

of the things that... we study is that type of the behavior.

When you identify the character of the stock as to how it moves, how the price

moves, and obviously that's all being based on how institutions are behaving

how weak hands are behaving.

And this type of shakeout is to be expected as we have seen

before this type of the behavior.

So you should not be extremely concerned until the price

actually hits our stop loss, which is below the main low.

So I'm still in this position, even the local shakeout is happening. I see

positive actions here where there is a quick reversal of the low where there is

some value, and then there is a test.

So that looks great.

Add to the position here. I just missed that. But I wanted to have a

confirmation. I wanted to see a positive

position before I start adding to the position.

So I let this rally run, but this rally was really great. It showed to me that,

indeed, this is the stock that is worth my attention.

And the Wycoffian structure,

It's concluding. We are in the potential phase C, and we have the rally that has

a lot of momentum. And remember, guys, from conventional technical analysis,

momentum always will precede price.

Quickly losing my voice in New Year.

The next shakeout or shakeout type of reaction.

is all market related.

It's not stock related. It's not group related.

It's all market.

Volatility of the market takes even the leadership stocks down.

So therefore, we just need to assess as to what kind of damage the market could

do to this particular stock.

Again, we are out if our stop loss is being hit. There is no question about

that, but it's not.

Instead, we're seeing high or low, and we still want to stay in this position.

And currently, I'm still in this position.

The goal is very long -term, but the logic as to how I'm selecting

the stock or how I'm getting into the stock or how I'm going through such a

period of volatility is all white coffin.

All of this analysis of staying in, adding to the position, or getting out

the position.

all based on Wyckoff studies, Wyckoff concepts.

And I kind of would like you to see the benefit, you know, through actual traits

of studying the methodology and, you know, developing the skill of visual

recognition of all of those concepts.

A couple of questions here.

Okay, great.

I like that the group is active.

This means that we're going to have a good cycle.

Hold on a second.

All right.

So this comes from Charles. Oh, Charles, hi.

Just a thought about Eric's comment. By stopping to operate, he might have

meant, should one have continued looking for immediate opportunity for new

trades? Just a thought.

Okay, yeah, I could see that point, Charles. And we're still talking about

Novodea trades, so I'll come back to that trade.

into that slide, you know, if you have any other thoughts on that. So I could

definitely see that. And then again from Eric, in Canadian solar phase B, is

that an upthrust or upthrust action and what's the difference?

All right. Well, yes, we definitely have multiple upthrust situations here,

right? So we have a first upthrust here, another upthrust

here. Another up thrust, another up thrust. So what are the up thrust? Up

are just temporary commitments to the upside above the levels of the

and then almost instant return back under that resistance.

And we're seeing that in all of the cases, this is what we see.

The price commits temporarily.

and then comes back under the resistance almost instantly.

Now, the difference between upthrust and upthrust action, and all of them are

just upthrust action, in my opinion, at this point of time, is that when

we say that this is an upthrust action, we actually suggest a specific bias,

which is to the upside. So upthrust action will be discussed during the

accumulation and during reaccumulation.

will be discussed during the distribution or redistribution.

We will talk about this more and in more detail.

And specifically in session number three and four, we will talk about the

distribution a lot. And I will give you a lot of the, you know, definitions on

upthrust, upthrust actions, springs, different type of springs, shakeouts,

so on and so forth. So it's all ahead.

All right, next question.

In phase A, which is the automatic rally of the first leg to the

intermittent line or the candle with the weak point into the straight line?

Oh, Eric, what's the question then?

Which is the automatic rally?

Okay, got it. Yeah, so Eric, I definitely feel that, you know, there is

knowledge behind it, behind the question. Actually, in my opinion,

There are three automatic rallies here.

Just because we're discussing phase A that has this testing, this area is a

test, and it's kind of the conclusion of the testing of phase A.

We had multiple attempts to go down.

So this is of the same magnitude as the selling climax.

So therefore, we want the test to be of the same magnitude as the climactic

action.

From that perspective, we might have multiple automatic rallies. And this is,

again, something that will go into the detail. This is a little bit more

advanced. So usually this stuff we...

We leave for the practicum, which is the continuation of the Wyckoff trading

course. And this is a little bit more of the advanced concepts, but really good

question.

From Justin, Ramon, how do you pick your entry prices?

So I've developed kind of like a proprietary reversal mechanism

where I'm identifying specific bars.

that are reversal bars and that act as what i call a point of no return

this type of bars suggest that a reversal has happened and

you need to this would be the most optimal point of entry it's below this

uh points of entry or rather the lows where you could

have the

the best reward -to -risk ratio.

And these are the points of the lowest risk.

And as Wyckoffians, we always want to open the position, let's say we're

the position to the upside after the reaction, after reaction, after

after reaction.

There are two spots only.

One was identified by Wyckoff himself, and then the second one we added.

in the Wyckoff trading course.

And again, this is something that we'll talk about. We will talk in month number

four, in March, April, about tactics.

How do we get in? I will show you the Wyckoff way, how his logic worked

on the entries and stop losses and exits.

And then in the practicum as a continuation, we will definitely talk

you know, this proprietary technique that I'm going to show you.

All right, let's look at another trade or another case study.

And this case study is about Shake Shack. For those of you who, you know,

my analysis and follow us on either WyckoffAnalytics .com or,

you know, presentations that I occasionally give on StockTrust .com.

you're probably familiar with this trade that I've done.

I also have a description of the first trade on YouTube, so I'm not going to

spend a lot of time on that. This is a really good trade, a really good swing

trade. This is kind of like a very typical trade that I would have in the

that is a bull market.

So for the bear market, this type of trades are not necessarily going to

And you will see this almost instantly.

But this trade was great. It was based on the idea that the earnings are going

to be having a favorable reaction.

And we're going to have some kind of push into the overbought condition on

earnings. And the plan was just to get out of this position on the excitement

weak hands that are still getting into this position.

Therefore, I want to leverage this. I'm using options calls.

This was one of the profitable trades in 2018, which was

vastly profitable.

You can see why.

The first point of entry was on this bar again.

This question as to how do you choose your entry points, I will explain later,

but as you can see, a little bit premature entry.

The add -on was much better. It was much more optimal in terms of the point of

entry. The price was the same, but I had to sweat it out for a couple of weeks

into the next.

into the next add -on i'm adding here at the same price because i'm seeing what

is happening here on earnings as the price gaps down it doesn't really go

much below the low there is only one bar that commits to the downside and then

there is an instant recovery so by itself it acts strong after a negative

reaction to earnings

And also, you know, there is a much, much longer term structure, a trading

that has developed and had a major sign of strength.

And we are in the potential backing up, last point of support type of action.

After that, everything is mechanical, kind of easy. There were some other

where you could add to the position.

Here is one. Here is another. Here is another.

And then before the earnings itself, you could actually, you know.

If you are a speculator like myself, you could create a position even here

with the weekly options.

And it worked out really nicely. I'm thinking that this is a buying climax,

we're going to have some kind of trading range at this point.

A lot of supply that is coming in on this bar. Again, something that is not

necessarily visible to a naturistic eye.

I will show you how to decipher the volume signature based on the price

to understand that the supply is coming in at this point.

So I just closed the position, both of them, and obviously we

see that supply has come in, but absorption is happening pretty fast.

And that was the suggestion, to still keep at least a portion of the position.

as a continuation.

All right, so that was the first trade. But the next series of trades that

followed were in a different environment.

Remember the market environment from February, March, April lows, where we

absorption in the market of the supply.

So that was favorable for this trade.

What happens next is not as favorable.

We are in the September.

So we already have some slight deterioration, yet we are in the stock

the leadership stock, that's number one. Secondly, that shows a correct Wyckoff

structure, both in the trading range and also in the

uptrend itself.

And we are at the point of the support, which I am interpreting as phase C.

I'm entering position intraday on this bar, which acts as a potential sign of

strength bar, suggesting that there's going to be a continuation at least to

$70.

And instead, the price just reverses. It reverses in a specific way.

We're still thinking that the sign of strength is developing here.

And then a backing up action, a small reaction.

which should come to the support and then reverse and continue

to the upside.

And this is where the failure happens.

So this bar right here shows that failure.

I'm not necessarily closing the position right away. I'm thinking, well, could

this be that this phase C was not phase C, but we still were in phase B?

And could this be a potential phase C?

Not a lot of supply comes in, like we've seen, let's say, here.

So that was the point of the hesitation.

I felt good when the price recovered, but it recovered to the same levels of

resistance that we've encountered before.

And once, after the low or high, we have the next failure, I'm out.

And actually, I think that in my opinion, and I tell my students, that

good trade.

And again, in your minds, you might be thinking like, wow, what is he talking

about? Why is this a good trade?

It is a good trade because you give yourself an opportunity to profit from

a continuation of an established uptrend.

And if you fail, then you just need to quickly close that position and just get

out with your risk management.

I'm not losing more than I need to, but I give myself that opportunity and it

just didn't work out.

The next trade, so if the first trade was a good trade or the best trade or a

perfect trade, well, not the perfect, the exit was a little bit premature.

The second trade was definitely, I would call it bad trade.

So what is happening here? So I think I'm being emotionally caught up here in

the previous trade.

And I'm playing the earnings.

So entry number five, which actually...

preceded by entry number four.

So entry number four on this bar right here was an entry pre -earnings. It was

day before earnings.

So my analysis shows that there should be some kind of positive

earnings. I just don't know what kind of reaction is going to be to the positive

earnings. In the bear market, the positive earnings sometimes could

negative result.

And the institutions will be selling into the strength of

weak hands that are trying to react to positive earnings.

So therefore, I'm just basically wrong on this entry.

But I think where I'm kind of proud of myself as to

how I managed that mistake was by recognizing

that The earnings day itself has elements of the selling climax.

We have an increasing volume signature.

We are coming to the point of support, which was defined already by three

points. So it's a legitimate downtrend.

And if this is a selling climax, then we could profit from some kind of reaction

to the upside.

Each time when we have a climactic action, with that increased volume,

spread to the downside, we know that there's going to be some attempt to go

So what I'm trying to do and compensate for the loss, which I still have as a

position, is that push to the upside.

And it happened exactly in the way how I was thinking it would.

I didn't know that we're going to recover that fast.

This bar was really good.

And here the question becomes is in the environment where the bias is to the

downside, an attempt to commit to the upside more

times than not is going to become an upthrust.

Same here in the same spot.

So once the upthrust develops and the price quickly comes back,

below the resistance, there is no reason for me to wait, and I'm closing the

majority of my position.

Now, I left some, and this is just a negligible

position, but still, I wanted to see how I would manage it.

And as the price goes down, look at what happens.

I'm seeing that the selling is exhausted.

I don't see the same type of selling that... Let's say we've seen somewhere

off the top.

So this type of selling produced this violent reaction.

But here, selling is more exhausted.

The supply is exhausted.

And we see that also in the spread to the downside.

And once we come into the oversold condition, which we are identifying as

potential stopping action right here, then I'm thinking that there's going to

another reaction.

And we would be seeing probably a reaction back into the point of the

resistance.

So you kind of could see that I'm explaining to you guys how I'm managing

position, even when I get into some trouble.

And I think this is a very important skill for us to develop.

And it's not like I'm doing this all the time.

This is the skill that an advanced trader needs to develop.

to understand how the structure unfolds and what are the most opportune points

for us to act upon.

So, again, something that we will be discussing

during the tactics in March -April briefly, and then we're going to discuss

it more during the WICA practicum.

This is a very interesting case study on all of these traits. This is just like

a godsend because it shows to my students, first

of all, the mental outlook, the analysis itself, and tactics.

A lot of tactics here with this position.

And therefore, it's just like in one example, you have everything. The good,

bad, and the ugly. I love it.

All right. Some questions here.

In Shake Shack, can we assume from entry two at 42, the price is increasing is

due to no selling.

Supply available institutions have it all. I would like if you can explain the

volume signature about that entry two, please.

Okay. So entry number two. Yeah, and the logic is correct, Eric.

The increase of supply.

shows the increase mostly into the earnings event.

And after that, supply is still relatively high on some of the bars, but

goes down.

But not only that, one thing that I want for you to see is that not

only supply is going down at this point, but demand is increasing as well. And

this is also extremely important. Look at the demand.

On this bar and even on this bar right here, there is a lot of demand on this

bar. Again, something that we will study in the second month.

But comparing this area and this area to what we've seen before into the

reaction, we're seeing a definitive increase in the demand signature.

So what does it mean?

Institutions are coming back. They're establishing their positions because

see what? They see value.

And also on this type of bars, they see liquidity.

Liquidity is extremely important event for them to participate in because of

their size.

They are huge. They have billions and trillions of dollars. And for them to

a position, someone has to sell in order for them to buy that big position.

Again, something that we will be discussing later in the course.

Can we assume if we see an increase in the volume as each selling climax in the

downtrend channel that the context is fast price falling and the price is near

to go up to the automatic rally?

Sometimes the questions are phrased a little bit strange.

So we'll work on this, Eric.

So we're looking at this spot right here.

So increasing the volume signature, what does this suggest?

Stopping action, right? So why is this a stopping action? Well, because the

volume increase usually will have the increase in both, in supply and

demand. We just want to understand what dominates at this point.

Supply still dominates the demand, but...

Demand is absorbing the supply on the way down, and then it's absorbing on the

way up on the next bars or multiple bars.

The same happens here.

Absorption of the supply, supply is increasing, but demand is increasing as

well. Supply is still dominant over the demand, but that absorption, that

occurrence of the demand.

And then subsequent buying after that, we see that in the next three bars,

suggests that there is value, there is liquidity for big institutions that are

coming in, they are buying, and that suggests some kind of at least attempt

rally. And that's the big distinction, because if the bias is to the downside

here, then the distinction is going to be that our trade is going to be just a

rally.

And I think that in this post -analysis, this is one of the mistakes that I

made, you know, later on with this particular stock, that, you know, more

here than here, that we are in the downtrend.

And therefore, all of the trades, even if you open it at the very opportune

time, which this entry was just perfect, you have to be faster.

getting out of the position.

So the exit was relatively okay, but could have been much better. And by the

way, guys, you know, during the whole course, this is the mentality that I

I don't like when people say that, oh, you

should not be thinking about perfect entries and perfect exits.

Well, I don't think this way.

I don't like it this way. I don't like to think this way.

What I like is for us to study how, where

exactly we're going to come in into the position, at which spot and why,

and where exactly we would be exiting and why as well.

And I want us to concentrate.

on perfecting our skills, not only recognizing what is developing in front

us, but also developing tactical skills, execution skills as to where we open

the position and where we close. And for whatever reason, everything has to be

logical.

Otherwise, do not do that at all.

All right.

Dog is asking.

Could you speak about establishing reward and risk as it appears sometimes

price support as stop loss leads to potential large dollar percentage loss?

Yeah, so I'm going to be extremely quick here, Doug, because this is a little

bit out of the scope. So on your point of entry, define your point of entry.

Define your point of risk with the stop loss.

Define the risk itself.

And that's going to be in dollars here. And then define your target. So for

instance, here, I've defined the target from the long -term chart. I'm just

showing on this chart, this is where my target was.

So the logic here was, as the price exhibits climactic action in the target

zone, I'm going to exit.

And that's exactly what I've done.

If you understand where your point of entry and let's say your minimum target

let's say $56 and then the risk here is what?

About like two bucks, two and a half bucks.

Then you could figure out what's the potential. So $18 of

reward and then $2 of risk. So what is our risk to reward ratio? It's

$18.

divided by $2, and that's 9 to 1.

So this is a really good reward -to -risk ratio, and it worked out very

It's a different risk -reward ratio here or here, right? So we were thinking

about 70 as our target, maybe slightly above as an upthrust above that, maybe

72, 73, 74.

We also could use the PNF here, right, to calculate the potential.

Well, it didn't work out, so it doesn't matter at that point.

Why getting into the position before earnings is gambling? Get in after.

This one is from Michael.

Yes, I agree with you, Michael. And I would say that for beginners and

intermediate traders, don't even do this.

If you don't understand how to trade earnings, just avoid them.

Throughout the course, I'm bringing a lot of evidence to you guys that

earnings are actually a subject of institutional

bias at the time.

And I'll talk about this in the course. I'm not going to develop this into a

whole discussion, Michael, right now, but let's discuss this during the

It's just a big, big topic.

Okay, another comment from Michael. So between February 6th and 9th, stop by

resistance from the top to June 11th. No long positions until clear direction.

Yeah, and this is what I'm discussing, Michael. You know, obviously this was

ugly.

And obviously a lot of the mistakes was made here.

But my point here is that when you make mistakes, guys, A

lot of you are, and I see because I worked with so many traders and so many

students, I see that you're withdrawing.

And I understand the pain. It's an emotional pain.

And usually as humans, we are just built this way to survive, to go away from

emotional pain.

And market always has an opportunity for us, you know.

to produce this type of pain when we are doing something not by the plan, when

we're deviating from that plan, when we are misinterpreting what we see. And I

think that's kind of like what exactly happened here in the ugly trade.

But it's a very valuable lesson to all of us and to me specifically because I

was trading this and, you know, just a small portion is still in that trade.

What is the lesson?

Well, obviously, you know, have a feedback loop into the trading plan.

number one.

Again, something that, you know, we discuss in other classes.

And then secondly, figure out how to manage your position.

Even if, you know, you have a loss, especially with options, you have many,

ways of how to diminish your loss.

That's the way how I look at those things.

All right, let's go to the next section.

Okay, let's talk about the markets.

And this is going to be really quick because I just want you to understand

logic, the my logic that I look at the market.

our Wyckoff logic, which by the way, each Wednesday, Bruce Frazier, my

colleague, and a great Wyckoffian and I, we discuss in the Wyckoff market

discussion class.

Each Wednesday, all of our students come to that class, submit their charts,

which Bruce and I review.

We discuss the markets every time, and we look at the whole market.

From the sector perspective, from the industry group perspective, the stocks

those groups, we look at the commodities.

We have so many case studies that we go through.

We talk about non -white coffin topics.

Bruce is an amazing storyteller, and he's been in the industry for quite some

time, since 1982.

So it's always amazing just to hear the stories from the past and also

listen to his interpretation.

And I'm going to show you three slides from the last Wednesday class, which, by

the way, you can find the whole class on our YouTube channel. It was a free

class last week.

And look at what we've discussed during this class. All of the symbols we put up

so that our students would see what's coming in our discussions. All of those

were discussed last time.

And currently, we have a promotion for this class.

You can sign up at $79 a month, which is regular $99. And this offer is going

to expire this Wednesday.

Go to our website, find that class, sign up, and check it out. And check it out

on YouTube where we just posted that video, and it's a featured video.

So what are we looking at here?

Well, obviously, we are right here now. So I have not updated the chart.

So we are coming back into a trading range or

above this local climactic action.

Which is a bearish sign or a bullish sign?

Well, it could be interpreted in either way, and we still yet to see what's

going to happen. So I'm going to show you both of the scenarios.

Bearish scenario and analog for the bearish scenario that I'm using here is

-2008 market, where we also had the same type of upthrust action.

like a structural point related to the previous lows.

Then we had a rally, an attempt to create the new high and a failure.

And even structurally, we kind of have it in the same way where we see a

as a low or high, then a potential spring that fails.

And remember that failed signal is the best signal. So again, potential spring.

and then the failure.

And how did it develop in 2007?

Well, I think in December, the last December session, which was

December 16th, and we conducted that session three hours together with Gary

Fuller, which was so much fun. Gary is like such a great white coffee, and just

a great person, and he's just always so energetic, enthusiastic.

And if you have a chance, you know, go and check out his offerings on Wyckoff

products. He is a very, very good intraday trader. He's a very good

Wyckoffian and Wyckoff experts on volume and spread analysis.

And Gary and I, we've conducted together a class on sprints and upthrust. That

was a lot of fun and just a lot of great information.

Kudos to Gary for doing all this work.

So look at how we go in into the oversold condition.

So we kind of called that continuation into the climactic action just based on

this analog.

And what this analog suggests with the WICA structure that we could be

potentially in the trading range. That's scenario number one. And that's a

bearish scenario where we could encounter some resistance at the point

support.

that we've encountered before, and then just retest, retest, and a trading

range. A trading range like this would suggest a continuation of the down move

to the downside like we did in 2007, 2008, and also in 2000 and 2001.

All right, let's look quickly at a different scenario.

This is not necessarily the scenario that is... preferable scenario for me.

show you another bullish scenario that I like more.

But I want to point your attention to two boxes here, two

blue boxes.

One of them comes in 1998.

And obviously we could compare these analogs based on the

economic environment and where we are in the cycle.

What I like about the 1998 scenario is that it produces on a

technical basis an oversold condition, and that's exactly what we've produced

just recently.

And this oversold condition is very significant because we have been in the

secular uptrend for quite some time.

So every time we've been in the oversold condition, we had out of that a very

quick rally up.

And if we're discussing a bullish scenario, this would be the most

scenario for bulls to have that quick rally. Why? Well, because if everyone

is so bearish, who's going to sell?

Who else is going to sell if everyone is so bearish?

The sentiment is so bearish that at some point, if we are in the

reaccumulation, this whole move to the downside will be considered a shakeout

rather than a downtrend.

And because of that reason, and I always look at both scenarios, by the way, and

this is what I teach my students, we always look at both bearish and bullish

scenarios. But if we're looking at the instances where the rally is going to be

very fast to the upside, and that's going to...

have some elements of accumulation by institutions, then it makes a lot of

that out of the all -assault condition, institutions are going to cover their

shorts and they're going to see that big institutions are buying in and trend

-following institutions are going to also participate in this rally.

So one of the bullish scenarios is based on this.

diagonal, not diagonal, but expanding triangle, where

you have different environments in the structure, where you have the

reaccumulation texture with the price and the volume showing decreasing

volatility, testing of the previous lows, and then the rally that fails.

and developed a distributional structure and then has some kind of short -term

downtrend. Look at what has happened in the 1960 -1980 trading range in the

market. The same texture.

We have the reaccumulation texture first. That suggests that from the lower

we're going to have either a sign of strength or an upthrust. It becomes an

upthrust. A lot of distributional qualities here and then a short -term

downtrend. And then out of that oversold condition, we have a pretty good rally.

Well, look at the recent development.

Kind of has a lot of resemblances.

Reaccumulation texture with the absorption in March, April, May, and the

into the upthrust that develops also into the local distribution with the

-term downtrend. So the key for this analog to work is to obviously, make

that if we're going to have a rally, it's going to be fast and it's going to

quickly bring us to at least one half of the trading range.

If, on the contrary, the rally will fail and we're going to have

the retest and the trading range, I would favor more of a continuation

to the downside, obviously with a small extra care.

If we're going to have something like what we've seen in 2016, then this could

be another potential reaccumulation.

So these are the things that we kind of routinely, Bruce and I, look at WMD

classes again on Wednesdays. The current promotion is going to be until this

Wednesday, January 9th.

All right.

Let's go to the next slide. And I'm going to speed up a little bit, so I'm

to slightly disregard your questions, guys, for now. Let's see at the end of

class how much time we have.

So I just feel like we spent a lot of time on the trades, but it was a good

segment. So what are we going to learn in like a trading course?

Well, as I've mentioned, the market structural analysis, Price structural

analysis is kind of like the dominant theme with

the Wyckoff methodology.

If you think about what the method covers, except for the price structural

analysis, and we would be talking about volume and price.

Volume and price is covered in technical analysis, so you don't necessarily have

to have the Wyckoff method to discuss supply and demand.

At the same time, there are obviously some distinctions.

But talking about the price structural analysis, what is there for us to

explore? Well, we're going to start with the change of character. And this is an

extremely important but very simplistic concept.

And I'm going to show you guys how the environment changes and how we need to

identify that change in order for us to understand how the price is going to

behave in the nearest future.

We also, that will lead us to that price structural environment, whether we are

trending or non -trending. And if we are trending, you know, what kind of trend

we are in. Then we're going to talk about WICA phases and WICA events.

So whenever we go into the consolidation, we want

to conduct a phase analysis.

is all about identification of specific Wyckoff events and specific

characteristics that belong to those events that help us to identify the

that help us to identify the timing of when the price is ready to leave the

consolidation, and also a potential character with which the price is going

travel. So these are going to be our goals.

Supplying demand is going to help us out both, you know, not even both, in all

of them. It's going to help us out to define the bias and confirm the bias.

It's going to help us out to define the timing as to when the price is going to

leave. And also, it's going to be crucial in identification of the

character of the next move.

Now, if the bias is the primary concern of the beginner, The

timing is definitely more of the concern of the intermediate trader.

Character is all about advanced study. And that's kind of like how it is with

the course. We're first going to talk about the bias and timing, and then

going to switch in the practicum into the character.

One thing about the character that I will say, and then I will go away from

this.

Character is extremely important, and in some cases, students come to me and

they ask me a question. Well, how can you possibly identify the character of

next move?

Well, you look at the price and the volume, and it's all there.

In a lot of cases, when students come to me, if the beginner comes to me and

they ask me, what would you recommend me to read?

What kind of books?

We have all of the recommendations on our website, by the way, under the

resources navigational button.

Books that Wyckoff wrote himself, books that people wrote about Wyckoff method,

and also books on technical analysis.

Those are the books that we recommend to the beginners.

To the intermediate and advanced traders, I recommend not to read books.

And my only recommendation is to read charts because a chart always

has everything that you need.

That statement by Wyckoff where we have to judge

the market by its own action is a very profound statement for me personally.

And the majority of my studies,

99%, right now as you know after 20 years of reading the books reading the

articles is all about the charts there is nothing else so um just kind

of like a side note on that let's come back to the supply and demand what's

under there that we will be studying well obviously just the volume and price

analysis itself and the relationship of the effort and the result those likes

Extremely important concepts.

And then we will go into the details of the bar -by -bar analysis or swing -by

-swing analysis.

Bar -by -bar is the volume spread analysis, as you know. And swing -by

analysis is extremely important, especially in the trading range.

We will discuss the volume patterns of different WICO phases in different

consolidations, which are accumulation or distribution. And we'll talk about

only the volume characteristics, but the price behaviors for those volume

characteristics. And then we'll talk about historical analogs that I use even

the course for the beginners.

Then our attention will shift to the relative and comparative analysis.

Relative strength analysis is a pretty common

analysis in technical analysis.

I'm not spending a lot of time on that because usually students come well

-prepared, but there are some specificity and especially contextual

to the Wyckoff method that I'm going to be pointing your attention to. On the

top of that, I'm going to show you some of the things that I do or that I

recommend to our students to do in filtering and scanning.

And we will use something as simple as StockShot's engine.

StockShops .com engine to identify that selection and to go through those

filters and scans.

And then our last segment is going to be devoted to trading tactics and

management. And you kind of have seen a little bit of the preview with some of

the trades, some logic there.

The logic that I've explained is a little bit more advanced than with some

the trades. We will be predominantly thinking about the points of entry,

do we open the position and why, our regional stop loss and how we move

and then how do we exit and what are the strategies.

on exit that we could use. We'll talk about scaling in, scaling out, how that

benefits our risk management profile, and so on and so forth.

And then we'll also talk about different tactical scenarios.

And this is more an analytical skill than tactical skill here.

But tactics are sometimes more useful than analysis

itself.

some of the trades that I do just based on tactics rather than analysis itself.

Okay, and as I mentioned before, the course duration is 15

sessions. We're starting today, so our last session is going to be on April

15th. The time...

That we're going to spend together is two and a half hours. So this is 37 and

half contact hours for the whole course. Again, right now we are at the

discounted price.

So take advantage of that.

All right.

All right. Well, finally, we actually start in our lecture in the material.

Let's talk about Richard T. Wyckoff himself.

Who was here?

I think that he was a fascinating character just because of how his

life unfolded.

One of the most interesting pieces on Wyckoff I actually read in

Stocks and Commodities, Stella Asoba's article on Richard D. Wyckoff, which I

believe was published either two years ago or a year and a half ago.

during the summer of 2017, I believe, maybe earlier than that.

It's a five -part article. I highly recommend it, not

as an overview of the method itself.

It probably could have been more in -depth, although I think that Stella did

good job talking about the method itself as well.

But it was...

so fascinating to read about the life of Richard D. Wyckoff.

He was an editor. He was a trader.

He was, you know, an acquaintance to

such big operators as Jesse Leavenmore or Herman King.

And obviously, he lived in the area when JP Morgan was conducting his

campaigns. And what he did is he

followed those stock market operators.

And he was collecting the data on their trades, interviewing them, and

trying to extract their best practices.

um on how they conducted their campaign and the whole course and the idea of

institutional presence which he called the composite operator

is just based on his observations of those people and um it's just

fascinating to think that he had access

sometimes direct access or through the interviews of just living through that

time and collecting the information on such amazing traders at that time.

And he codified all of those practices into the course.

Unfortunately, his personal life was...

somewhat hectic, and he died relatively young, I think, for our time.

Maybe it was okay back then.

He died in Sacramento in 1974,

34, and after the third marriage, which failed, and

where his wife took the possession of almost everything.

And I think that he was forced.

after the divorce and into the early 30s, you know, to create something else.

You know, so his magazine on Wall Street was taken away from him. His real

estate holdings were taken away from him.

His family was kind of ruined in a way. And he had a very bad health at the

time.

And I thought a lot about this, you know, and sometimes I feel like, you

kind of like, you know.

talking to him, you know, obviously, you know, from my mind, you know, and

projecting what he would answer to me and talking to him and discussing, you

know, his life and, you know, what has been happening during that time. I felt

that he was forced to write the course.

This next, this slide right here, the course that he has published.

And 31, 32, 33, 34, that's the main course that is left

for us that is more sequential as an educational piece.

Now, whenever students ask me, and first of all, you could find this online. I

believe this is in the public domain right now.

Whenever students ask me.

Do you recommend to read this course? For the beginner, yes. But if you have a

chance not to read that course and read it later, I would rather you do that.

And there is a reason why.

Because that particular course is somewhat outdated.

And my recommendation, if you want to read on Wyckoff, read Bruce's blog.

And I've mentioned Bruce already.

multiple times.

So Bruce conducts WMD session with me on Wednesday.

Bruce is a blogger on StockCharts .com. A lot of you know that. A lot of you

read his blog.

But for those of you who are not familiar with his work, please go to

StockCharts .com, find his blog.

It reads as a book.

I'm trying to push Bruce to publish his blogs as a book.

That makes a lot of sense to me. So we'll see how that's going to go. But

our students are required to read his blogs, whether you're going to start

the beginning, and sometimes it reads as a book, you know, he goes through the

analysis, you know, and there are a sequence of blogs on specific

that he has or a sequence of blogs on the specific concepts and so on and so

forth. This is definitely a must -read, and I would say even before the

Wyckoff course itself.

So you could definitely study Wyckoff methodology through his blog.

If you don't want to read, come to the classes. If you want more details, more

in -depth, and more interactive stuff, then obviously a class would be the

But definitely check out Bruce's offerings.

All right, let's come back.

Well, Wyckoff himself, I thought, was not only a great trader, but he was a

really good businessman.

And sometimes people disregard this, but because I'm in this business, I

understand how hard it is to conduct this business because you're always

on record.

And as you could see, even today, I'm showing you the trades and somebody's

going to say, oh, you shouldn't be doing this or you shouldn't be doing this and

so on and so forth.

So you're kind of constantly being bombarded by the feedback of people.

And I have a lot of respect for people who do this job and for Wycombe himself

because he was such a pioneer in this business. And at one time, he had over

200 ,000 subscribers.

We don't have so many people subscribing to our current services, I must tell

you right away.

But you know who did that?

William O 'Neill.

And that's why I have a lot of respect for William O 'Neill as well.

And we know that William O 'Neill, on the technical side of CanSlim's system,

used a lot of Wyckoff ideas. And we saw this as a confirmation from the

comments of...

somebody like Chris Katcher or Morales and other people.

And even when you look at some of the William O 'Neill trades, not the ones

are breakout trades necessarily, but the ones that are long -term trades, they

are very much like Coffin.

And we'll talk a lot about the differences between

the canceling.

entries and exits and Wyckoff entries and exits.

There is a lot to learn there in the differences.

You know, I have a lot of students from counseling that come and actually

really, really enjoying and benefiting the knowledge of Wyckoff methodology

because. It allows them to be a little bit more in control on the technical

analysis side of things.

It's definitely more in -depth studies on a technical basis.

And look what Wyckoff has done. He was publishing the ticker.

And here, this is so cool, an article with William D. Gann.

And that just tells you, like, He was living in such an amazing time for

technical analysis where Dow was creating his theory, where Elliott was

his structural theory, where Gann was making all of these

trades and just amazing material that he was publishing.

And he was living in the times of such amazing stock market operators.

He later on...

became an editor of the magazine of Wall Street, just a very big subscription.

And this is so cool to see also Western Union Telegram.

And then he published quite a few books.

Now, also a question about the books. Should I read the books? Yes. If you're

beginner and intermediate white coffee, you should definitely have those.

They are not necessarily the books where you could extract a systematic approach

to trading, but you will find a lot of the great advices and some of the

elements on tactics as well. You just would have to read all of this and

this information from those books.

Again, if you want a shortcut to the knowledge, then start with the course,

read Bruce's blog.

Read specific books that I'm giving you, and this is my advice for the beginners

and intermediate traders, by caution, traders.

For the advanced traders, my conversation with you is going to be

different, and it's going to be more about let's put the chart on and let's

about it. Let's analyze it and let's figure out the way to understand it

So that's the way how I teach.

All right.

Let's talk about the composite operator.

So what is this concept that Wyckoff talked about, composite operator, or

Gary always would say, composite man?

Well, a composite operator or composite man is a heuristic.

It's a device that helps us to understand how the price structure is

formed. and why.

So I'm going to translate this into modern terms.

We're basically talking about large institutions as a

group of

investors and traders that influence

the price structure in a very big way.

Because of their huge size, and think about something like

PIMCO or Warren Buffett or

BlackRock and multiple other huge institutions, and they could be

hedge funds, they could be banks, they could be any type of financial

institutions like pension funds, insurance companies.

And by the way, those have so much money, and I worked with institutional

investors, and I still do, and it always surprises me, you know, the size that

they have, the requirements that they have for trading. It's a different type

trading than retail trading.

So all of those institutions, if they're conducting their campaign the same

way, They're becoming a big force behind the buying and selling in the market.

And that's what moves the price.

And that's what observes the supply.

And that's what creates points of liquidity

where they operate.

And Wyckoff called it a composite man. And the assumption was that because of

the size, they can dictate.

the potential buyers of the next move, which is absolutely true.

The more money you have, then the more you invest into the stock, the more you

control.

So he called it a composite, man. He was suggesting that multiple stock

operators could be marking up or marking down the price and conducting those

campaigns. In our days, I am talking...

only about the institutions. I will mention the composite man or the

operator, and you should be able to understand this concept.

All right, let's talk about the price cycle. And we also will go into the case

study on Apple, where I'll show you how specifically at that spot, Apple was

selected and how the trade was conducted.

But first, let's talk about more of the theoretical.

price cycle.

So as we've talked about the composite operator, I also want to talk about the

difference between strong hands and weak hands.

We usually would be thinking that, and this is how we unfortunately were told

or taught, that the weak hands are always public hands.

This is absolutely not true.

And actually, if that would be true, the market would have a different look and

a different structure.

The weak hands could be both, public and institutional hands.

And as I work with institutional, as I worked with institutional traders, I

tell you guys that institutions are like us, skin and bone.

They are human as well.

They are driven by the same emotions that we have.

They have the same brain.

The only difference between them and us, a couple of things.

First of all, it's their nine -to -five job. That's number one. So they devote

much more attention to what they do.

Secondly, they have an enormous size, an enormous edge in how they receive the

information.

And those are the advantages that kind of...

propel them, in a lot of cases, to the strong hands.

But every year, in every type of market, since I started

teaching,

trading, learning this stuff, working in the financial field, every year I read

the articles that...

over 90 % of all of the hedge funds are failing to outperform the market.

And that's why the latest idea, and I love Warren Buffett's idea, is

that you might as well in the secular bull market just invest into the ETF,

market ETF.

You could make a more selective.

trade like this based on the sectors and groups, not specifically stocks.

But it's been very, very successful.

And as we know, Warren has won a bet that lasted for, what, like 10 years, I

think, $1 million that ETFs, market ETFs are going to outperform. That was a

very low -risk bet.

And obviously, Warren knows a lot about that stuff.

we could see how sometimes we could confuse institutions with strong hands.

I don't want you to think this way. I want you to restructure your thinking

and think not in terms of institutions and public, but in terms of strong hands

and weak hands.

And then we're going to say that usually strong hands are going to be the

composite operator.

Composite operator is going to have huge size.

And the timeframe for the composite operator is always going to be a

cycle and beyond that.

Think about Warren Buffett and his average holding period for a winning or

non -winning stock.

It's not a year.

It's not two years. It's not five years. It's a decade or two. I mean, some of

the holdings that he has had throughout his career, it's just been there for a

long, long time.

This is the trait and the characteristic of the composite operator. Why is this

important? Well, because their behaviors are going to be based on the needs that

they have.

They have a need to establish a huge, sizable position, and they need to hold

on to this position for quite some time. They cannot go in today and close the

position tomorrow. It wouldn't make sense to them at all.

The taxation problems that they will incur, that's number one problem.

And then the portfolio rotation, that's number two problem.

And then just generally going in, going out, as you might know even from your

own trading, is very dangerous because you're increasing the number of mistakes

that you make.

And these are the things that I'm hearing from institutional clients that

have, that those are the big things that...

They pay attention a lot.

Then we're going to have, after the composite operator, which is basically a

contrarian in a lot of ways, we're going to have a lot of institutional trend

followers. Those are also big -size institutions, and they usually look at

market cycle timeframe, meaning that their positions are probably going to be

beyond a year.

That is going to be favorable from the taxation point of view.

but they're going to be acting a lot as a composite operator and jump on the

emerging trend and jump off the trend once they see the signs of

And they're going to pick up the timeframe that's going to allow them to

the money for quite a long time to ride the whole uptrend and then

distribute either on the way up.

during the consolidation or on the way down, and that's what produces this

compounding effect and big profits that they accumulate throughout the years.

Also, on the strong hand side, we're going to have professional traders.

And here under the professional traders, I probably should mention that there

are pros that are institutional pros.

And then there are retail pros.

Obviously, institutional pros are going to have somewhat a larger size, but very

serious retail professionals are going to be having also a good size.

A good professional is not going to have a small size on equity

just because it doesn't make sense.

With the risk management, you have to control the risk in a specific way, so

can't commit all of the capital, you know, to a specific position or to,

you know, a few positions. You're going to, you know, control your risk and

portfolio risk through some of the techniques that they have, and therefore

have to have a size. So this is still a very sizable group.

that is a professional group, in a lot of cases, they could be strong hands and

be on the right side of the bias.

On the weak hand side, we're still going to talk about the retail traders as the

public, but we also will talk about institutional and professional managers.

And I mentioned to you just a minute or so ago that those people

could be wrong too.

Our first assumption, you know, when we started studying Wyckoff methodology,

that strong hands, institutional hands are always correct.

Well, that's not right.

I've seen it myself.

I mean, I've coached them.

I've mentored them. I've taught them the method. I saw their mistakes.

A lot of them are just, you know, like us. They just have more time to devote

this craft.

You know, as in any profession, somebody is good, somebody is better, and

somebody is not that great.

And, you know, the market is unforgiving. The clients are

So if you not progress with your studies, understandings of the market

execution, you will be out really fast.

So let's look at the price cycle itself. And now let's try to understand.

the behaviors of strong and weak hands, how would they behave at different spots

of the price cycle?

Well, first of all, the price cycle itself is just a representation of the

accumulation period

under the oversold condition where the sentiment changes from

bearish to bullish.

that goes into the markup phase based on the absorption of the supply and not

the availability of that supply by institutions throughout the markup

then into the area of the distribution, the area where

strong hands are going to start distributing the stock.

And that's going to be in the extreme of what condition and where the sentiment

is going to start shifting like it did in September, October of 2018

from the bullish bias, a bullish sentiment

into a bearish sentiment.

And then as this distribution happens, that starts the markdown, a

downtrend where

On the way down, we're going to see different groups to capitulate at

points.

And we'll talk about that as well in more details later on in the course.

Now, each group is going to have specific

emotional or psychological characteristics.

And they behave in a specific way.

So, hey, thank you so much for being here. And by the way, if anybody has to

don't forget that, you know, I'm going to post this video on YouTube so you

could check it out later. So, yeah, I really appreciate it, especially for

of you who are in Europe right now or in the Middle East or in Asia.

I understand your commitment and I appreciate this.

And I see you. So thank you for that.

So let's talk about that sentiment and the psychological landscape and the

behaviors.

of strong and weak hands. Well, we know that in the downtrend, into the

conclusion of the downtrend, into the stop in action, which will be defined as

selling climax, we're going to have extreme point of fear and capitulation

weak hands.

Don't forget that weak hands are not necessarily just public.

They're also institutional, professional hands.

And therefore, that capitulation by that big amount of money, that they carry

the equity that they have is going to produce that quick move to the downside

where they're saying get me out at any price i don't care i'm done i have too

much overpaying and my clients are on my back so at that point of time

what this does it creates this type of action creates liquidity

And it also creates, with the price moving down, a value proposition to a

composite operator.

And we must say that it's not just liquidity, it's a high liquidity.

And it's not just a value, but it's an extreme value on the long -term

basis and the short -term basis.

And that's exactly what people like Warren Buffett, Jim Rogers love.

They want to come in and they want to take the stock at the best price and

the best availability where everybody is giving up in bunches and they're just

saying, okay, I'll take it. I see the value here. And maybe not in three

maybe not in six months, I will make money. But in a year or two, as the

develops,

into a more favorable structure.

And as the business conditions improve, whether it's market conditions, whether

it's an industry group condition, and whether this

is just the stock -related conditions, they're just basically saying that long

-term, I see value.

And I see that this is an extreme point. I'm going to come in and I'm going to

buy. I'm going to establish that initial position or a chunk of my position.

This is going to be the place where we will identify on the chart the first

signs of intelligent accumulation by strong hands.

And then throughout the whole trading range, a lot of people are still going

to be disbelievers.

of the next buys that's going to come.

So therefore, as the composite operator is going to buy on average at

the lower price of the trading range, and that would produce the rallies.

That's going to subsequently retest the levels of the support and where the

composite man is going to start adding to the position every time it hits their

buying point.

the sentiment gradually is going to change.

Those bearers that were actively and aggressively selling, they're going to

that their trades don't work or they work but not that great as in the

downtrend, and they're going to give up.

Some of the weak hands are going to give up their latest

additions maybe or the positions that

they have had.

And they've helped even through the downtrend.

And Composite Man is just going to scoop all of the latest offering.

And that's going to absorb the supply to the point where technically the price

will start making higher highs and higher lows.

This is where the emergence of a trend is going to occur. And this is an

extremely important concept.

Emergence of the trend is...

everything that I talk to institutional money managers.

All of the assistance is basically based either on the contrarian value

proposition or the emergence of a substantial trend.

And this is where what I call the institutional trend followers are going

come in.

And they're going to start establishing...

their positions, that will push the price even further up.

The public is still not actively participating at this point because they

scared.

They just had the pain of a loss that they incurred throughout

the whole trading range.

So as the price continues to the upside, this is where they are starting to

become very active. It's in the second part of an uptrend of the Markov thing.

And because they are getting excited here and they are producing more volume

and they are sustaining the selling by institutions that are selling

now into the strength of the weekend.

Once that strength is exhausted, the selling is going to start producing the

price structure that's going to resemble more of a consolidation.

And when all of the buyers are going to be exhausted by this process, the price

will start to deteriorate and it's going to start showing lower lows.

By that time, the smart money, the real smart money in that particular position,

and by the way, smart money as I see it now with all of this knowledge

and experience that I have teaching and trading and working with people, whether

institutional or retail people,

The smart money definition is only relevant

to the last trade that you make.

So in a way, it's kind of like in NBA,

a make or miss league, right? So you always have to be at that

performance level where you're not just producing the...

positive result, but you were actually outperforming the index. Otherwise, why

would they give you the money to manage?

They could just give it to the market, put it in the ETFs, and just be done

that.

So the definition for each of the institutions always

changes with a specific trade.

And they could be in one trade representing smart money and in another

they could be representing weak hands.

And Buffett is a good example.

I mean, like look at his, for instance, the trade in IBM where he came in and

then he had to close out with the loss and relatively soon as he opened the

position. So even here could be weak hands at some point of time.

So weak hands at this point of time are seeing this as a value for the first

time. They saw the value on the way up, and they were correct here. They were

enjoying the profits.

They saw the value at the points of the lows at the support level in the

consolidation, thinking that there's going to be a continuation.

And then they're still seeing the value even as the price starts to deteriorate.

And this is where everything collapses.

Strong hands are out of the position.

Completely the composite man is out of the position. Or it's just hedged in a

way that still produces some kind of bearish sentiment.

And then the weak hands are just capitulating in the markdown phase.

And that's what produces a quick move to the downside. No buying

and selling.

And not just selling, not an orderly selling, but a capitulation.

That's why bear markets are so quick, so aggressive, and so volatile.

All right.

Let's go to the next slide. And guys, I'm going to speed up at this point

So I'm going to come back to your comments maybe a little bit later on.

So here is an example of the price cycle.

with an Apple stock. This is a weekly chart.

This is actually not the beginning of the cycle. This is just a reaccumulation

of a much larger cycle that has started in 2009 low.

And we're seeing the last reaccumulation before the distribution actually

occurs.

And we're seeing how after the consolidation with the bias to the

have a really good markup phase.

distribution after that, which leads us to the new low in 2013,

accumulation again, and then the next move to the upside, and

distribution again, consolidation in 2016, and you all know what has happened

here and what has happened just lately.

And you kind of could see that This goes on and on and on, and obviously price

cycle could look slightly different on a secular basis for different stocks.

But for this particular stock, you could take this cycle even from the point

of the IPO from the 1987 to 2003 trading range,

which was a huge period to be in that type of range with one huge,

big rally in the middle.

But after that, it's all like that.

This just has been a pattern for Apple. So our goal is to understand

what is happening in those consolidations because it seems that

those consolidations that we have the moves that we want to participate in.

those are directional traits.

Obviously, you could use some hedge.

trades, even in the uptrends and downtrends as well.

This is totally acceptable if you understand how to do this. But the

just concentrating on the directional bias, on identification of that bias, on

the timing of when the price is going to exhibit that bias or start exhibiting

on the emergence of the trend, and then obviously on the character of the move

itself. And not only that, During the whole markup, markdown phase, especially

markup, we are going to have a lot of spots, a lot of consolidations where

we're going to apply our Wyckoff analysis, whether it's a phase analysis

price and volume analysis, and we're going to identify specific places of

timing where we want to establish a position.

for the next potential swing to the upside.

And hopefully you guys have seen this type of trading

from the case studies that I presented on my trades. By the way, on the YouTube

channel, I have also published quite a few trades.

And all of my students here, you guys know that.

I usually discuss my trades. Again, this is something that I don't shy away.

I think that there should be more of that.

It doesn't matter whether it's a mistake or a profitable trade.

What matters is knowledge.

Can we extract the knowledge from any of the trades?

All right.

So let's look now at the first reaccumulation box, and let's look at

selection process that we would go through.

Another slide, I'm sorry. Okay, so before that, before we do that, a couple

things on this slide.

This is a very old slide. This is the slide that I created almost 10 years

And this slide was based on Hanks Pruden.

And I don't know whether it was Hank who kind of originated this idea. I think

it was actually originally the idea from the Stock Market Institute.

It's an idea of an action and test.

The only thing here that I added here is the reaction.

So we have kind of like three things that are unfolding.

Action to the downside, reaction to that.

Stop in action on the consolidation.

And then the test of this reaction.

Is this test going to fail and the price is going to go lower?

Or is it going to stop, reverse, and the new

trend is going to emerge?

And we obviously could go even into the consolidation and use the same thing.

We could say that

Selling climax by itself is an action that is being followed by the reaction

the automatic rally and then being followed by the test of the secondary

phase A.

Or we could say that, as I told you

before, the downtrend is an action and then phase A and phase B is a reaction

that action and phase C is a test.

to that reaction, to that action.

And the main thing that we want to identify within this process is the

testing action.

Because the testing action usually is going to be identified by us as not just

the testing tool, but also the timing tool as well.

If the test is successful, then most likely there's going to be a

of the bias that we think, is developing during the consolidation.

So therefore, the timing is going to be identified by us as a

potential phase C. So each time we identify phase C, we're going to assume

that this is the beginning of the next major move.

And that's why phase C is so crucial.

Well, if phase C is the low of the trend or the high of the trend, kind of like

an extreme point of the trend, the beginning of the trend.

And by the way, for those of you who are thinking, well, what about if phase B

has a lower low than phase C or a higher high than phase C?

You could be right in terms of the actual definition of the trend.

But still, we would prefer to be more efficient with our point of entry. We

don't necessarily want to enter in phase B, enter the position.

We want to enter into the position when the price is ready to move in the

direction of the bias.

So phase C is extremely important, and so is phase D.

Why is phase D important? Well, because phase D is all about emergence of the

trend.

And phase D is all about a change of character that is being confirmed.

From a non -trending environment, we are switching to a trending environment

with a specific bias.

Talking about Hank, I mentioned him.

Obviously, Hank has passed.

Suddenly, his last presentation was...

In August of 2017, even talking about him right now, I kind of feel

still so sad.

He was a great man.

He was definitely my first mentor here in the U .S.,

and I owe him my career, basically.

And not just from the perspective of the Wyckoff Method.

which I consider him kind of like he was a guardian.

You know, he was always, he would always criticize me for bringing innovation

into the method, you know, bringing something like, you know, those

you know, students call those Romanism, you know, like new definitions, new

ideas and so on and so forth. He was kind of like protecting the methodology

a...

very interesting way.

And he not only, you know, initially, and

together with Bruce, they taught that class, but I think the first class I

actually took from Hank by himself.

Not only did he taught me the methodology, but

he also taught me a lot of the business.

You know, in a way,

The community that we have built with Wyckoff Analytics, it has Hank's

A lot of the things that I've implemented and our team implemented is

on Hank's work at Golden Gate University. And I'm just so happy and I

privileged that I worked so closely with him in the last six, seven

years.

And I've been in his classes. I always was advising students to take his class,

at least one, at least one.

He was a very unique teacher. And a lot of the teaching techniques also I'm

taking from him.

Just a very extraordinary person and an extremely

significant figure in my life, in my not just professional life, but partially

also in the personal life.

His whole family is just so nice and still nice to me, and I'm so

sad that he's gone.

But he lives through us, and this is the biggest thing that we could do for him

and his family, is just to remember him and remember him in the way how he was

teaching us to conduct ourselves and conduct ourselves in the markets.

His book, which is called The Three Skills of Top Trading, is a required

for our students, and I definitely recommend this book to all of you to

Chapters 3 to 7 specifically talk about the Wyckoff Method, and those are the

required chapters that I usually ask students to read. In this picture,

this award is holding.

is the award of the Chartered Market Technician that he received, I think, in

April, and he passed away in August, so just months

before he passed away.

And not only he had received it from the Chartered Market Technician, which is

the biggest technical analysis organization here in the U .S. and

world, but also from IFTA, International Federation of Technical Analysts.

at the 2013 conference in San Francisco.

And he definitely deserved it so much for

the times when the methodology

was not in a good shape for like 20, 30 years.

It was...

not necessarily very profoundly highlighted as a technical analysis

Hank and Tom Williams, David Wise,

Craig Schroeder, those are the four big...

figures at that time. And then new generation of Lycopherans came, like

and we had quite a few Lycopherans came out of those classes, like Jim

Forte, and so on and so forth. And then, you know, my generation came, and we

became also, you know, more knowledgeable about methodology just

So just a lot of kudos to him and the way how he conducted his life and the

how he was with students.

I just, you know, still have so many stories about that.

Ditto, Eric.

I miss him too.

All right, let's talk about the case study.

So this example, we are looking at the trading range.

before the big move up. Actually, this is the range. And it's a complex range

because you have a trading range structure on the trading range

Actually, I was in this trade to the downside.

Apple was underperforming around this area.

This was the trade and closed out somewhere here.

So what does this trade tell us?

That there is no ability to go down. The supply is not increasing over different

other areas, and that suggests a reversal,

a change of bias, and change of leadership, which we see on the sign of

rally. We're definitely exhibiting more of a leadership over the market. Looking

at the relative strength ratio line, and this is something that we will explore.

I will show you how to construct it.

show you how to use it. I will show you how to interpret it. But here we're

seeing that the relative strength is showing outperformance by Apple on this

rally to the upside.

And if you guys remember the market at that time, the market only has come to

the high of the resistance and then went into the shakeout.

And even on the shakeout, we see our performance by Apple, where the market

creating a low low, and the stock is creating a high low.

So strength, strength, which is great.

And this would be, based on the relative comparative analysis, for us, a point

of selection.

Now, there is one minus to what is going on here, and that is that supply is

suddenly up.

And we know when supply is going up, we always need a retest.

And we have multiple retests which start to create a

trading range.

And therefore, when we go into the trading range, again, the things that we

to define is bias, timing, and character.

And this is not necessarily the sequence with which Wyckoff was approaching this

or SMI was approaching this or how it was thought at Golden Gate University.

This is just what we've created for the WTC course.

And this is how I teach the material right now. Those are the three elements

that are extremely crucial to me to understand.

I want to understand where the price is going to go, when it's going to go, and

how it's going to go up.

As we go through the analysis of the consolidation, we are going through the

phase analysis.

And we are also going through the supply and demand analysis together with how

the price reacts to that supply and demand.

And we are seeing that supply is diminishing significantly into the area

looks to us as a potential phase C. So that defines not only the absorption

of the supply,

which gives us a bias to the upside, but it also gives us a timing. The time

is now.

Supply is very low. It's in strong hands.

We could talk about also a short -term underperformance, which

usually leads to great buying opportunities within the structure of

price cycle.

And this is something that we will concentrate on as well.

And then obviously the whole campaign. And then the next biggest white of

identification for us would be a change of character.

I actually, I did not trade this particular rally in Apple,

but I had multiple students back at Golden Gate.

and in my private practice that were trading Apple at the time.

I wonder if you could guess where they exited their position.

Well, before you even answer this, I'm going to tell you exactly where.

Here, here, and here.

And why do you think that's it?

What would be the logic of getting out of this position? I mean, obviously,

except for the logic of smaller swing trade, which... It wasn't. It was more

a big swing trade like this one or like this one from one trading range to

another, from one structure to another.

Well, their logic was that supply is coming here.

And my argument with them at the time was that look at the result

of this supply coming in.

And that's a very, very common mistake.

that students make.

And that's why we're going to study a lot the result and effort.

This is one of the most important concepts.

If I would be picking the concept to teach, whether the concept of the supply

overcoming the demand and the price going down or a demand overcoming the

and going up, in comparison to the effort and the result, I would choose

effort and the result.

Supply and demand is a very simplistic concept.

But effort and the result requires an understanding and a visual skill of

recognition. And that's exactly what's happening here. And that's exactly the

mistake that we were trying to correct at that time.

The key to the exit was a different behavior than we've exhibited on the way

Look at all of the reactions on the way up. They are very small.

And even though some of the volume signature increases in there, there is

absorption on the way up. As supply occurs, it's being absorbed and the

moves up.

But not on this reaction.

Not on the automatic reaction, which acts as a change of character.

We see that not only supply is emerging a

lot, but it's also very consistent.

This is another definition that we've added to the Wyckoff Trading Course.

Usually, volume is being interpreted as just an increase and a decrease.

But we could see the consistency of selling in this area, as we have seen

consistency of selling here and here, attempt to sell.

And what does this suggest?

In all of these cases, it suggests a change of environment.

So from the uptrend environment, we are going into a non -trending environment

or a trending range.

And at least minimally at this point, you should start thinking in your head,

what should I do?

Should I close out the positions? Should I scale out? If I'm anticipating a

trading range, is this a very long -term trend, campaign trade for me? Then I

could probably check out my P &F targets from back then in 2009, 2010, compare

them with the P &F targets that we've just recently had in the trading ranges.

So we would be making a decision here, but that decision would be based

initially

on the way how the price behaves on this reaction.

And this is the skill and the knowledge that I'm going to give you guys.

All right, 530.

Let me see.

Okay.

All right, let me see what we are going to... Let's stop here.

Let's stop here. So what we are going to do is...

Obviously, we haven't gone through the whole material that I was planning for

today.

But this is great because what I'm going to ask you guys, for those of you who

already signed up, is I'm going to ask you to read and I'm going to ask you to

watch the videos and I'm going to ask you to prepare for the second class. And

then we will go into the change of character, accumulation, and the

distribution. I actually like that a lot.

There is a question. Have the seminar been recorded?

Yes.

I'm recording it right now, and I'm going to post it on our YouTube channel,

Wyckoff Trading Method.

So you could probably check it out tomorrow morning or even late tonight.

My team will upload it and put the description in. So check it out.

Again, for those of you who are thinking,

about signing up for this course.

Let me just go to the correct page.

So make sure that you go to WyckoffAnalytics .com, that you find

Course, and just...

sign up before next Monday, which is January 14th, to get the discounted

If you have any questions, don't hesitate to reach us at

gmail .com.

You could find our contact information on our website and just

address it either to me or to our team and we'll be more than happy to answer.

I'm available tonight and tomorrow and throughout the week.

So if you have any questions, you know, maybe on the administrative side

or maybe content questions, you know, don't hesitate to contact us.

Meanwhile, students who signed up, I will email you tomorrow and I

will assign you the homework, which will be just region specific.

chapters of Hank's book, Bruce's blog, and watching our videos on YouTube.

And that will be your homework.

And then after the first class, once we cover change of character, accumulation

and distribution traits, then we will go into the homework and you'll do the

actual homework.

Well, really great class.

great beginning.

I feel like there is a lot of interaction from you guys.

So hopefully that's going to just transition into the class itself.

Let me just see kind of like last comments here from Doug. Oh, I

love this comment.

My brain hurts.

Great detailed session. Thank you. Thank you, Doug. And I know that you've taken

classes from us. So you've been a student. So that's how it is.

Thank you very much. Great information to consider. I trade commodities. I was

very interested in the program.

So let me kind of address this.

And I think that there was another question here on Forex. So I've actually

traded Forex for almost five years.

It just was a little bit tough to trade something like this, living on the West

Coast in the U .S., just so hectic during the night to stay up.

So I kind of gave it up.

Forex has the same price structure as other price structures. There are some

nuances, obviously, volatility, interventions, and then also there is

always the reference to the bad volume data.

So my answer to forex traders is that take the course.

Why? Well, because the price structural analysis is still a must.

You have to understand the context of where you operate, where you trade. So

that's number one.

Secondly, some of the Forex traders use volume signature.

So you can do that.

Thirdly, relative and comparative analysis is still relevant in Forex

And one of my strategies was always buying the strongest of the correlated

and selling the weakest of the correlated pairs.

And you could create pair trading like this or spread trading. You could just

choose directionally which instrument you want to pick. So there are quite a

things there on the analytical level that you could use.

And then you could also use a lot of tactics.

And tactical decisions is something that you have to develop as a trader one way

or another.

So whenever I talk to Forex traders, I always tell them that this could be a

foundational course for you. This could be the course where that kind of like

defines the foundation on which you build further up.

So consider that.

And the same for the commodities traders. I actually love trading

I love trading eminence. I've day traded eminence for quite some time.

Occasionally, I would make those trades here and there now.

I predominantly trade stocks right now and specifically options.

But I love trading oil.

I trade gold.

I trade metal sometimes whenever opportunity presents itself.

So to me, trading is not about a specific instrument.

trading to me is about specific opportunity.

And I think when you're becoming more and more advanced trader, you will

understand that opportunities are very rare.

Good opportunities are very rare.

And our goal is to recognize them. And even when you recognize opportunities in

the market, sometimes you fail to see them or act on them.

And sometimes opportunities come from very interesting places.

Sometimes you would be thinking, oh, I trade stocks, I'm not going to trade

other markets.

Well, if you're a speculator and if you're an advanced trader, then you

consider that.

Sometimes you look at different time frames and you see how, let's say, a

-term campaign would be much more profitable than, let's say, swing

intraday trading.

And you should recognize that as an advanced reader.

So this is something that, you know, we talked more in the practicum, you know,

with more advanced students.

And this is something that, you know, I have to bring you to that level.

Okay, great.

Next, comments and some questions here.

Ramon, it would be great if you set a number to the slide to have the

to our notes.

Eric, yes, for sure, if you are a student in this class.

I can definitely do that for you.

I'm not going to distribute the slides for people who are just guests.

This is just kind of like a rule for this session.

The biggest value is obviously I'm trying to give to the students who

signed up.

But, you know, once in the class, remind me and I'll do that.

What are the tools that are necessary to do the homework? This is a great

question from Justin.

So one of the things that I want you guys to do is obviously, and I mentioned

this, bring me one file, email me one file that is

going to be either PowerPoint, PDF, or Word doc. That's number one, requirement

number one.

Name it correctly so that I would know that it comes from you and that this is

the homework number one or whatever.

And then thirdly,

You know, as you use these tools, you probably have to understand how to

the screen.

Let's say if you're on thought charts, capture the screen, cut and paste

into the PowerPoint, and then annotate those.

So that's the process.

And we could talk more about it if you still have some questions.

you know, during the next class.

So I'll explain more how to do this. And actually, maybe I'll have a slide on

some, you know, usual practices.

All right.

Next question or comment.

This comes from Lynn.

Although Wyckoff method could fit into any time frame, understanding your

training style is more...

of a swing trading, would the course curriculum be suitable for position

who mainly hold stock for a few months to a year or more?

Absolutely. And actually, I kind of slightly disagree with the way, Liam,

you phrased the question, but I understand what you're saying here.

A good swing trader should understand the long -term campaign.

And therefore, I teach you in Wyckoff Trading Course, a long -term campaign

and swing trades within that long -term campaign.

So a long -term campaign is going to be something where we will establish

a long -term trend first and then we will seek for the short -term

countertrend, which could be a trading range by itself or a reaction.

within the context of a much larger trend.

And you have to understand long -term campaigns.

So if you're a long -term campaigner and if you're holding your positions from a

few months to a year and more, you definitely will benefit from the course.

Good question.

From Igor, how do you determine the strong and weak currencies? So I

correlated currencies, let's say like British pound to the US dollar.

and let's say Euro to the U .S. dollar.

So there are times when they are highly correlated and when they are less

correlated, right?

So it's during the times when they are highly correlated, and you have to

it, and there are sites that would tell you this, and you could see it from the

charts as well when correlation is very strong.

It's when this correlation is strong, this is where you want to use this

concept. And based on the comparative analysis, just to define which one is

stronger, which one is weaker.

And if you're making directional trades, just take the trade in the direction

of the buys and use that definition. You could also

use this for spread trading or pair trading.

buying one currency, selling another currency, however you would create that

type of strategy, and then trying to define the spots where the spread is

increasing, and it always goes up and down, and sometimes it has a trend of

own, especially when correlation goes away.

So you could create trades out of that as well.

So hopefully that explains it.

Okay. Craig is saying that my microphone is not working really well and that my

voice is breaking up. Is that true for everyone, guys? How's my audio, by the

way?

I just want to know. This could be just either on your end or my voice could be

just going down.

And sometimes connection is not that great. So sometimes too much traffic.

Yeah, okay, well, let me see what kind of audio we're going to have on this

recording.

I apologize if not everything was very clear and correct. Thank you for

this.

All right, last question, and then we're going to stop.

Roman, what's the difference between

Wyckoff Trading Course and Wyckoff Practicum. All right, so the Wyckoff

Course, think of this as a knowledge.

And Wyckoff Practicum is something that a student

with the knowledge does not have.

That is a skill of recognition of those concepts that

you know now.

So I always tell my students, knowledge,

is not necessarily the skill of visual recognition.

If you acquire the skill of visual recognition, you will see how the

structure divides, the timing, the character unfolds.

Now, my next statement is going to be that even if you acquired a skill of

visual recognition, it doesn't mean that you can execute it.

So you have to build a skill of execution.

Those are tactics.

Even if you conquer that, you still have to conquer the emotional part of

trading, and that means that you will have to look deeply into your behaviors,

trading behaviors, translate those into your life behaviors, compare those, and

figure out how you fit into your trading style and into your methodology and so

on and so forth. And this is definitely a very, very advanced level.

Whenever I have a beginner or intermediate trader come to me and they

want to work on my mental outlook, I say no.

You have to study first the methodology. You have to be comfortable with the

technical analysis and recognition of those patterns so much.

that it doesn't distract your brain from concentrating on your mental landscape

adjustments.

And this is definitely a topic for another long conversation.

All right, guys, I think that's it for today. Great session.

Thank you for all of your comments, for all of your questions. This has been a

blast. A great first session for those of you who signed up or are thinking

about signing up. I'm looking forward to working with you.

As you could see, you know, a lot of material we have to cover in this 15

sessions. So we're going to start working more next class. Make sure that

have a headset and a speaker as we're going to interact.

And I'm looking forward to it. Thank you, guys.

Have a wonderful evening. Bye -bye.