WY-01-07 / 03
Step Three: Assess Whether the Established Cause Supports the Expected Target
First Principles
Lesson / WY-01-07
Step three asks, “Even if direction is correct, is the remaining room worth the loss if the trade fails?” The classic method defines a candidate range on the bar chart, then uses a point-and-figure chart with fixed box size, reversal amount, count line, and boundaries to measure horizontal columns and estimate a conditional target zone. Calendar duration, vertical range height, and accumulated volume cannot substitute for columns.
Course content is for learning and research only. It is not investment advice.
Read the Chapter ↗Timestamps
7 lessons · Chapter contents
01Step One: Establish the Overall Market’s Position and Probable Direction↗02Step Two: Select Instruments Aligned with Market Direction and Suitable Relative Performance↗03Step Three: Assess Whether the Established Cause Supports the Expected Target↗04Step Four: Assess Whether the Instrument Is Ready to Move↗05Step Five: Time Participation with the Overall Market↗06Dependencies and Reassessment between Steps↗07Redefinition and Adaptation beyond Stock Selection↗Observe the market: start with context and place price within its structure.
Understand structure: compare supply and demand, and let evidence support or revise your hypothesis.
Form a view: define risk limits and know when to reassess.
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What the Wyckoff Method Studies
The Composite Operator Model and Strategic Interaction in Trading
