Recently spent a lot of time studying the Wyckoff trading method, and the more I read, the more I realize how profound this nearly century-old theory is. Simply put, it reveals a harsh reality: there are always manipulators in the market, and most retail investors are losing money while being manipulated.

The manipulators' tactics are nothing more than three types. The first is exhaustion, which is a fatigue battle over the time dimension. You think it will rise, so it moves sideways; you think it will fall, so it moves in the opposite direction. Only when you can't hold on at the bottom and cut losses does it rise; if you buy at the top, it falls. The second is shock, which involves sudden attacks in the spatial dimension, creating false signals of rise and fall to lure retail investors. The third is confusion, which uses various news and public opinion to create emotions opposite to the main force's strategy, covering their accumulation or distribution.

The biggest difference between retail investors and the main force lies in their market analysis logic. Retail investors rely on technical indicators, news, and fundamentals, while the main force only looks at price, volume, and the rate of change. Retail traders buy and sell based on indicator signals, whereas the main force judges based on supply and demand relationships and market behavior itself. Most importantly, retail investors lack risk management awareness, while the main force puts risk first.

Wyckoff's core insight is the relationship between supply and demand. He believes that once you truly understand the relationship between volume and price, all other technical indicators can be discarded. When supply dominates, the market price falls; when demand dominates, it rises. Our job is to participate during phases of clear demand. Only when volume and price match can a trend form; divergence between volume and price often signals a reversal. The takeaway for daily trading is to act during phases when supply and demand are clear.

Wyckoff also systematically summarized the five stages of a bear turning into a bull. During the accelerated decline, there will be panic selling and rebounds, followed by oscillation and sideways movement, then a quick drop and rapid rebound known as the spring effect, after which a volume breakout indicates the initial emergence of strength, and finally entering the main upward zone. Each stage has specific volume and price characteristics; understanding these helps identify entry points.

After studying this theory, my biggest gain is establishing a macro perspective. Now, when I look at a stock or a coin, I extend the timeline to the past few years and compare it with Wyckoff's stages to judge the current position. This gives my trading structure support. I also become more sensitive to phenomena like panic selling, key support and resistance levels, and spring effects. Previously, I would rush in near resistance levels; now I wait patiently for a confirmed breakout.

My position management has also improved significantly. When entering a consolidation zone, I no longer throw in all my capital at once but gradually build positions, starting small, and adding during spring effects or secondary tests of lows. This helps avoid buying at the top of oscillations and getting trapped.

Wyckoff emphasizes three signals for trading opportunities. The first is exhaustion of supply, shown as a bearish candle with no volume. The second is a secondary test after a continued decline, indicating decreasing selling pressure. The third is demand starting to enter and volume increasing, which is the right-side entry point.

But theory is one thing; practical application is another. Panic selling and secondary tests may not always follow the textbook pattern; there could be third or fourth tests. The key is to believe in one principle: if the accumulation phase lasts long enough, the rebound will be high enough. Wyckoff's method works across different cycles, especially during oscillation periods, where focus on daily or lower timeframes is crucial.

Risk management is the part I resonate with most after reading. All trend predictions are guesses based on volume and price phenomena; nothing is 100% accurate. When a mistake is made, you must exit quickly. Specifically, every buy must have a stop-loss, and entries and exits should be executed in parts. Be especially cautious of large bearish gaps with no pullback on the second candle—exit decisively.

Honestly, I only discovered this classic theory after decades of trading, which shows I was too impatient to enter the market. Without solid fundamentals, daring to trade is asking for trouble. Trading is fundamentally a psychological contest of willpower, endurance, and vision. Only by continuously improving cognition and skills can you survive longer in the market.