Richard Demille Wyckoff (1873–1934) was an early 20th-century pioneer in the technical approach to studying the stock market. He is considered one of the five “titans” of technical analysis, along with Dow, Gann, Elliott, and Merrill.
At age 15, he worked as a stock runner for a New York brokerage. Afterward, while still in his 20s, he became the head of his firm. He also founded and, for nearly two decades, wrote and edited The Magazine of Wall Street, which, at one point, had more than 200,000 subscribers.
Wyckoff was an avid student of the markets, as well as an active tape reader and trader. He observed the market activities and campaigns of the legendary stock operators of his time, including JP Morgan and Jesse Livermore. From his observations and interviews with those big-time traders, Wyckoff codified the best practices of Livermore and others into laws, principles, and techniques of trading methodology, money management, and mental discipline.
Mr. Wyckoff observed numerous retail investors being repeatedly fleeced. Consequently, he dedicated himself to instructing the public about “the real rules of the game” as played by the large interests, or “smart money.” In the 1930s, he founded a school that would later become the Stock Market Institute. The school’s central offering was a course that integrated the concepts that Wyckoff had learned about identifying large operators’ accumulation and distribution of stock with how to take positions in harmony with these big players. His time-tested insights are as valid today as they were when first articulated.
We have collated the most relevant content we can find from multiple sources including all of Wyckoff’s books (absolutely recommended reading), educational providers (of which there are many but I would point to stockcharts.com and WyckoffAnalytics.com as excellent teachers and a great resource for Wyckoff materials) and our own experience as traders and students of Wyckoff and being mentored by the late, great David Weiss. We will also publish the occasional video tutorial and any perspectives we think help in any small way to understanding the Wyckoff method and his theoretical and practical approaches to the markets.
Wyckoff’s methods can be applied to any freely-traded market in which large institutional traders operate, including stocks, commodities, bonds and currencies.
Many professional traders today use Wyckoff’s method, but his overall approach is still not widely-followed among retail traders, even though his educational efforts were intended to teach the public the “real rules of the game.” Nonetheless, his stock selection and investment methodology has stood the test of time, largely due to its thorough, systematized and logical structure for identifying high-probability and highly profitable trades. The discipline involved in this approach allows the investor to make informed trading decisions unclouded by emotion.
Using Wyckoff’s method, one can invest in stocks by capitalizing on the intentions of the large “smart money” interests, rather than being caught on the wrong side of the market. Attaining proficiency in Wyckoff analysis requires considerable practice, but is well worth the effort.
“May your longs go up, your shorts go down and your flat positions stay sharply unchanged. Safe trading.”
Nick