Accumulation, manipulation, distribution
Accumulation, manipulation and distribution name three phases a market moves through around a big move. Which phase you are in decides how patient you can afford to be.
In depth
Accumulation is the quiet sideways stretch where positions get built. Manipulation is the misleading push past an obvious high or low that shakes out weaker holders. Then comes the real move. Distribution is the wide, choppy top afterwards, where those positions get unloaded into late buyers.
One rule does most of the work here. A candle closing beyond your level stops you out, a wick through it does not. The wick is the manipulation. The close is the information. Sitting in a range with a same-day option is the other trap, because you pay for time while nothing moves.
Why it matters
Get the phase wrong and you buy the top of the move instead of the pullback inside it. Traders read the shakeout as a real break, sell at the low, and watch the move go without them. Others hold a short-dated call through a sideways stretch and lose the trade to time.
TraderLog cannot name the phase for you, but it can show what these trades cost. Tag your trades by the phase you thought you were in and the By tag table compares them. Automatic tags flag options that expired worthless, the usual sign of paying for time.
Frequently asked questions
Both look sideways. Accumulation comes before the move, distribution after it. What follows is what names them.
Same event, different word. Price pushes past a level everyone can see, fills the stops there, then closes back inside.
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