On Friday as I was going through Twitter, I came across this tweet from Bruce Fraser:
“Great Wyckoffian David Weis has passed.”
After reading this, I immediately started thinking about his book “Trades About to Happen” which I had learned so much Wyckoff methodology from. Just to name a few ideas/concepts that are discussed & taught in the book:
Springs & Upthrusts
Hinges
Absorption
Ease of movement
Shortening of thrust
I learned a great deal from studying/reading his book. It was recommended to me by someone in an old Wyckoff chat room I was a member of, and to this day I remember not being able to put the book down once I had opened it. Reading the book gave me a fresh perspective and confidence in the markets and helped me get on the track that I’m on today.
In Wyckoffian lexicon, the “spring” and the “upthrust” are perhaps two of the most widely used terms. Here is an example of an amplified spring (from S&P 500, March 2020):
In the late stages of a trading range there is a clear break below said trading range / support level, followed by a swift reversal to the upside
The “upthrust” would be the opposite: Wick above the range and a fast reversal back down into the range.
I just opened the book and flipped through some of my highlights.
Here are a few that I really enjoyed reading again (emphasis added):
..An engineered sell-off below such support levels provides the ultimate test. If the break-down fails to produce an onsluaght of new selling, the large operator recognizes the supply vacuum and buys aggressively, thus producing fast reversal action
When prices fall below a support level, I visualize a boxing match. If a boxer knocks his opponent out of the ring and into the fifth row of seats, the opponent should not recover and return to the ring, slugging away with renewed vigor. The breakdown tilts the scales in favor of the sellers. They are supposed to capitalze on their advantage. When this fails to occur, one can go long with a stop below the low of the break. This is buying at the danger point where the risk is smallest; however, it does not mean we automatically buy every breakdown in hope of a reversal. We do not stand in front of onrushing trains and try to pick up the loose change.
In his tape reading course, Wyckoff stated that uptrends end when the “selling waves begin to increase in time and distance or the buying waves shorten.”
In addition to the above concepts/ideas that I noted, this was also a helpful resource in learning to draw (better) lines on the charts. Trend channels and inverse trend channels are also discussed. It’s a great book, and I’d recommend it to anyone who has an interest in Wyckoff or just wants to improve on their general tape reading skills.
RIP David Weis. I am grateful for the wisdom you shared through your book and teachings.