glossary

Short, factual definitions of the vocabulary of the Wyckoff method, volume spread analysis and related public methods. Educational only.

terms

Accumulation

A trading range, usually after a decline, in which large interests absorb supply before a markup.

Accumulation/distribution line

A cumulative volume indicator, developed by Marc Chaikin, that weights each bar's volume by where it closes within its range.

Agentic trading

The use of autonomous software agents, often built on large language models, to monitor markets, reason over data and assist with or execute trading decisions under human-defined controls.

Automatic rally (AR)

The reflexive rally after a selling climax as selling pressure briefly exhausts; its high often defines the top of the range.

Base breakout

A move out of a consolidation (base) through its resistance, ideally on expanding volume.

Buying climax (BC)

A wide-spread, very high-volume advance where eager buying is met by large sellers, often marking the high of a distribution range.

Cause and effect

The Wyckoff law that a trend (effect) is proportional to the preparation (cause) built in the preceding trading range.

Climactic volume

Extreme volume with a wide spread at the end of a move, suggesting exhaustion; a selling climax or buying climax.

Composite operator

A Wyckoff teaching device that treats all large market participants as one entity whose buying and selling leave visible footprints on price and volume.

Distribution

A trading range, usually after an advance, in which large interests release positions before a markdown.

Effort vs result

The Wyckoff law comparing volume (effort) with price movement (result): harmony suggests continuation; divergence suggests absorption or a possible change.

Episodic pivot

A term popularised by Pradeep Bonde for a sharp, high-volume gap or move triggered by a fundamental surprise that can reprice a stock.

HLC bar

A price bar showing high, low and close: a vertical line from low to high with a tick for the close. The traditional chart for Wyckoff and VSA reading.

Jump across the creek (JAC)

A Wyckoff metaphor for a decisive move through the resistance (the creek) of an accumulation range.

Last point of supply (LPSY)

A weak rally after a sign of weakness, on narrow spread, that fails below prior support or resistance before markdown.

Last point of support (LPS)

A pullback after a sign of strength, on lighter volume and narrower spread, that holds above prior support or resistance.

Markup and markdown

The trending stages of the Wyckoff cycle: markup follows accumulation, markdown follows distribution.

No demand

In VSA, an up bar on narrow spread with volume lower than the previous two bars, suggesting a lack of professional buying interest.

No supply

In VSA, a down bar on narrow spread with volume lower than the previous two bars, suggesting a lack of selling pressure.

Preliminary support (PS)

The first notable buying in a downtrend, on increased volume, that slows the decline without yet ending it.

Relative strength

A comparison of an asset's performance against a benchmark or peer group; not to be confused with the RSI oscillator.

Secondary test (ST)

A revisit of the climax area, ideally on lower volume and narrower spread, testing whether the supply or demand seen at the climax has diminished.

Selling climax (SC)

A wide-spread, very high-volume decline where panic selling is absorbed by large buyers, often marking the low of an accumulation range.

Sign of strength (SOS)

A rally on expanding spread and volume that shows demand taking control, often pushing to or through range resistance.

Sign of weakness (SOW)

A decline on expanding spread and volume that shows supply taking control, often breaking range support.

Spread

The range of a price bar from high to low; in VSA, compared with volume to judge effort against result.

Spring

A brief move below trading range support that fails to attract follow-through selling and returns inside the range; a test of remaining supply in accumulation.

Squeeze

A period of contracting price range and volatility that often precedes expansion; also used for a forced move when trapped participants must cover.

Stopping volume

In VSA, very high volume on a down bar after a decline that closes off its low, suggesting selling is being absorbed and the decline halted.

Supply and demand (Wyckoff law)

The Wyckoff law that price rises when demand exceeds supply and falls when supply exceeds demand, judged from price and volume.

Test

A return to an area where heavy supply (or demand) previously appeared, to check whether it is still present; a successful test shows lower volume and narrower spread.

Trading range

A sideways price area bounded by support and resistance, where Wyckoff analysis expects ownership to change hands.

Trend template

A published checklist, popularised by Mark Minervini, of moving-average and 52-week-range conditions used to confirm that a stock is in an established uptrend.

Upthrust (UT)

A brief move above trading range resistance that fails and returns inside the range, trapping breakout buyers; a test of remaining demand.

Upthrust after distribution (UTAD)

An upthrust occurring late in a distribution range, typically in phase C, acting as a final test of demand before markdown.

Volatility contraction pattern (VCP)

A base in which successive pullbacks get smaller and volume dries up, popularised by Mark Minervini as a sign that supply is being exhausted.

Volume spread analysis (VSA)

A bar-reading approach derived from Wyckoff that judges supply and demand from each bar's volume, spread (high minus low) and close location.

Weis wave

A volume tool, developed by David Weis, that sums volume over each price swing so the effort behind up waves and down waves can be compared.

Wyckoff method

A technical analysis framework that infers supply and demand from price, volume and time, and models markets as cycles of accumulation, markup, distribution and markdown.

Wyckoff phases

Five labels, A to E, for the stages of a Wyckoff trading range: stopping the prior trend, building cause, testing, confirmation, and trending out.