Wyckoff trading method, page-1455

Firstly, just be aware that the standard "Wyckoff Accumulation/Distribution Schematic" you see all over the web, is the "textbook perfect" model of a trading set up........ and in the real world, the trading may not always follow the schematic perfectly. You will usually need to be flexible in your thinking, and how this textbook model is applied to a real situation. For instance, there does not 'have' to be some preliminary support (buying) come in before the selling climax. Yes it occurs sometimes, just not every time, it depends what has actually gone on in the past, and what has triggered the selling climax at the time etc..

That is not to say that the traditional Wyckoff schematic is not correct, it is just that in the real world, it often does not appear as clear cut or technically perfect as that. So you need to be a bit flexible in your thinking, because it is so easy to fall into the trap of making some price action fit into what you want to see, and not what is actually going on.

So in the real world it doesn't always turn out as clear cut as that schematic, in fact (without having any stats on this at all), I would venture to say that it usually doesn't turn out textbook perfect that way very often. For instance, there maybe what appears to be a selling climax, which should potentially be the beginning of an accumulation period, but for whatever reason (a new or unexpected announcement in the stock itself, a serious world event, or sector event, or the selling pressure continues to be overwhelming and cannot be effectively absorbed, or something else completely....) it is not successful. What may then happen is that all the stock which was bought in the selling climax needs to be dumped again, which causes even more havoc in the stock......or perhaps the selling climax stock continues to be held, but a second, and possibly even bigger, selling climax occurs (and in hindsight you would end up labeling the first selling climax as preliminary support, and the second larger one as the actual selling climax). And then the true accumulation zone begins.

I have seen this a few times, when there has been a successful accumulation and the markup process is underway, and all is going swimmingly, but then an unexpected announcement is released, and everything changes (like when BHP said they were considering buying RIO or WPL, or when a very very large capital raise is announced to build a mine). In these situations you will see a certain correct principle of the Wyckoff schematic occur, but not always in the right place, or in the expected order or place (as per the standard schematic). So for instance, there may have just been a re-accumulation and without another markup phase, the distribution starts, or a buying climax occurs, because the news has changed the expected outcome, or at least the timing of the expected outcome.
Another I regularly see, particularly in 'market darling' stocks, is multiple re-accumulations, not just one and a second mark up period before a distribution zone, but one after the other, over and over, with a mark up in between, without any 'proper' distribution period at all, or eventually a distribution zone only after multiple re-accumulations.

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OK, so on that chart above (which I have only glanced at, and not properly studied), I can see why you have labeled it as you have, and I like what you have done, as it shows you are thinking hard about these Wyckoff principles, and what they represent.
However for me, I question whether the selling climax is really big enough, yes there was likely enough support come in at that point to knock the stock price sideways, but an actual selling climax is quite rare and is a seriously big event. It is described as being a major desperate event where holders just want to 'get out' at any price, so as to get 'some sort of return' for their shares, as it appears if they continue to hold for much longer their stock may become completely worthless.
And perhaps to confirm this, it appears price has failed again recently (gapped down), and has broken down below where support was previously.....this is not usually what is expected in a 'normal' accumulation zone.

So yes I can see what you have done and why, and yes it makes some sense.......and I am really glad to see you thinking about these principles..........and you may turn out to be completely correct in the end........ but I am not totally convinced that this is actually a true selling climax and the resulting accumulation zone on that chart........we'll see.....


hopefully that makes sense.....

ask more questions if you need more clarification on any principles.

cheers