Wyckoff Theory
Master the art of reading institutional footprints through Wyckoff methodology. Understand accumulation, distribution, and trade with smart money.
A retest of the Buying Climax area
What It Is
In distribution, the Secondary Test is a rally back toward the BC highs. The key is volume—if the ST shows lower volume than the BC, it confirms that buying pressure is weakening. This is the mirror image of ST in accumulation. Instead of testing lows on lower volume (bullish), we're testing highs on lower volume (bearish). Each lower-volume test of the highs suggests demand is drying up. Multiple STs can occur in distribution, each ideally showing decreasing volume on rallies.
Secondary Test (ST) - Distribution - Visual
Price Behavior
- Price revisits BC highs
- Smaller candles than BC
- May slightly exceed BC high (testing resistance)
- Often forms lower high vs BC
- Rallies become shorter and weaker
Volume Behavior
- Volume significantly LOWER than BC—this is the key
- Shows buying pressure is exhausted
- Declining volume on rallies confirms distribution
- Any volume spike without new highs is bearish
What It Means
- Confirms the BC was the climax of buying
- Smart Money continues distributing quietly
- Demand is drying up
- Foundation for markdown is building
If the ST shows equal or higher volume than the BC and price breaks to new highs, the distribution thesis is invalidated. Re-evaluate the structure.