Not So Fast Bulls: Latest Bitcoin Pump May Be Wyckoff Distribution Throwback

The Bitcoin pump heard ‘round the world has the entire market bullish once again, following Bitcoin’s third-largest one day gain in its history on news that China is in support of the blockchain technology underpinning Bitcoin and other crypto assets.

Even the most bearish crypto traders have flipped bullish on Bitcoin, however, the spike could simply be a throwback according to Wyckoff’s distribution model, which would suggest that the rally is not only over, but that the real markdown phase will begin next.

Introduction to Wykoff Theory on Market Cycles

Richard Wyckoff was a stock market trader and editor of the Magazine of Wall Street. His work was focused on the logic behind market trends and developed the “Wyckoff Method” as a means to determine certain phases an asset may be trading in. The principles behind the theory are still used commonly even today and is often brought up by Bitcoin traders.

Wyckoff market cycle theory breaks down trading activity into four…