Understanding Wyckoff Analysis and Its Application to Cosmos ($ATOM)
Wyckoff Analysis (WA) is a method used to analyze the movement of prices in freely traded markets based on supply and demand dynamics. It is commonly applied to markets where larger or institutional traders operate, such as commodities, bonds, and currencies. In this article, we will apply WA to the cryptocurrency Cosmos ($ATOM) to forecast future events.
Cosmos $ATOM in Phase D of Wyckoff Accumulation Schematic #1
Cosmos $ATOM is currently in Phase D of a Wyckoff Accumulation Schematic #1. The volume spike near the Selling Climax (SC) and Spring indicates alignment, even if the overall form isn’t perfect. During Phase D, demand overcomes supply, leading to rallies with higher volume. The Last Point of Support (LPS) is typically a favorable position for a long position. Cosmos $ATOM recently completed a Reaccumulation and is rallying sharply.
Cosmos Price Targets
The basic target based on the schematic is $18, but it must first clear $15. Using the Horizontal Count method with PnF charts yields a target of $15.5 by adding the value from the formula 7 x $0.25 x 3 = $5.25 to the relevant low of $10.25.
Glossary
Preliminary Support (PS) refers to substantial buying that provides support after a prolonged down-move. Selling Climax (SC) is the point where selling pressure climaxes and is absorbed by larger professional interests. Automatic Rally (AR) occurs when intense selling pressure diminishes. Secondary Test (ST) is when price revisits the area of SC to test supply/demand balance. Spring allows dominant players to test available supply before a markup campaign. Test is when larger traders test the market for supply. Sign of Strength (SoS) is a price advance on increasing spread and volume. Last Point of Support (LPS) is a pullback to former resistance turned support. Back Up (BU) precedes a more substantial price mark-up.
Supplemental Reading
For further reading on Wyckoff Analysis, you can refer to the following resources:
– “The Wyckoff Method: A Tutorial” by Bogomazov & Lipsett
– “Reaccumulation Review” by Bruce Fraser (2018)
– “Jumping the Creek: A Review” by Bruce Fraser (2018)
– “Distribution Review” by Bruce Fraser (2018)
– “Introduction to Point & Figure Charts” from StockCharts
– “P&F Price Objectives: Horizontal Counts” from StockCharts
– “The Wyckoff Methodology in Depth” by Rubén Villahermosa (2019)
– “Wyckoff 2.0: Structures, Volume Profile and Order Flow” by Rubén Villahermosa (2021)
Hot Take: Applying Wyckoff Analysis to Cosmos ($ATOM) for Future Forecasting
By applying Wyckoff Analysis to Cosmos ($ATOM), we can gain insights into its current phase and potential price targets. Phase D indicates strong demand, and the recent Reaccumulation suggests a sharp rally. The target price is $18, with $15 as a preliminary target that must be cleared first. Using the Horizontal Count method with PnF charts, the target becomes $15.5. Understanding key terms like Selling Climax (SC), Last Point of Support (LPS), and Back Up (BU) can help identify favorable positions for trading. Further reading on Wyckoff Analysis can provide a more in-depth understanding of this methodology.
By
By
By
By
By