Accumulation, Manipulation, and Distribution Phase:
In futures trading, prices do not just rise and fall without reason. There is a pattern that usually repeats, namely the accumulation, manipulation, and distribution phases. By understanding this pattern, you can be more vigilant and not easily trapped by market makers.
1. Accumulation Phase (Market Maker Accumulating Goods)
In this phase, prices usually move sideways, not rising high or falling deep. Like a market participant who is negotiating but calmly.
Big players (market makers/institutions) carefully accumulate goods.
Prices tend to be sideways, volume is decent but not overly busy.
Beginner traders often get bored waiting, thinking the market is quiet. In fact, this is just a break for big players to stock up.
Characteristics:
Small candlesticks
Narrow range
Direction not clear
2. Manipulation Phase (Get Ready for a Fake Down)
This is the most intense phase. Big players start fake movements to deceive small traders.
For example:
Prices are pushed up quickly to lure small traders in.
Or they drop suddenly so that people panic sell.
The goal is just one:
So that small traders sell their goods at low prices or buy at inflated prices.
This is called liquidity grab, a trap for stop-loss orders to be triggered.
Characteristics:
Long wicks
False breakout (BO suddenly reverses)
Unusual movements, very fast.
3. Distribution Phase (Market Maker Selling)
After the big players are satisfied with their accumulation and have rubbed their hands with profits, it’s now time to release their stocks.
In this phase:
Prices seem to rise continuously, but in reality, they are just sucking in buyers.
Market makers slowly distribute goods to beginner traders who are happy to buy thinking the trend will keep going up.
When stocks run out?
Well, prices will crash.
Characteristics:
Prices strengthen initially but fail to break new highs
Candles start to wobble
High volume when candles do not move far (distribution signal)
The best entry point is to wait for the accumulation phase to see clearer market structure.
Be patient and keep learning 👍👍
Regards, margin call fool
