Anyone else trade based on the 4 stages of the market

I’ve been trading the 4 stages of the Market: Accumulation Phase, Distribution Phase, Advancing Phase, Declining Phase. I am looking for fellow traders who trade the same strategies to bounce ideas and to understand the 4 stages of the market better.

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I trade price action and candles only and tbh i have no idea what this is. Could you elaborate on if this is more of a fundamentals strategy or based on charts?

Theres 2 fatal flaws with this theroy. Its first is you need volume. There is simply no volume measure in a decentralized market.

Secondly and more importantly, there is no accumulation distrubtion phases. The market doesnt work like that. The market exist simply because parties need to exchange cash for whatever reason

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I kind of agree with @therealInsideBar (which is rare). Much of accumulation and distribution happens in the stock market because very large players can’t buy or unload all at once without moving the price.

Im really not so sure that is the case in forex because the market is so large. It may happen in the less liquid pairs - the majors not so sure.

Of course I’m more than happy to proven wrong in this

It can’t happen with the “less liquid” pairs because they are calculated crosses. If I want to exchange my AUD for JPY I first must buy USD with my AUD and then sell my USD for JPY.

We tend to forget we are just betting on the underlying market.

But If I was really clever I could buy USD with my AUD then sell for EUR then by my JPY and make a small profit from arbitrage.

Im talking More about the phases as strucutres of the market. i cant upload the link but rayner teo has a gread article titled the 4 stages of the market and how to trade them.


Yes I do have a habit of not answering the question from time to time.

So here goes, both me and @therealInsideBar trade inside bar breakouts.

Inside bars are accumulation - markets aren’t going anywhere there is balance between both bulls and bears. However internally one side is winning that battle.

The breakout of the pattern means we enter an advancing stage, or maybe an impulse stage etc

So my own strategy is really buying on the breakout of accumulation and exiting as distribution begins

That’s what most strategy’s try to do - I think the terms you are using are general ones for market structure and not meant to be specific trading approaches themselves


@therealInsideBar yes I agree. The concept of accumulation and distribution doesn’t fit in forex market. It’s more of a stock market concept.

Hey @Johnscott31 That sounds alot like the way I want to trade. I back tested identifying accumulation, distribution, advancing and declining phases and when i was trading i traded the advancing like an up trend, the declining like a downtrend and for distribution i traded the bought the bottom of the range and for accumulation i sold the top.

do you have any more info on this inside bar method you speak of?

If you go to my blog (link in my profile here on babypips) look around you’ll see my harami inside bar strategy - under the category technical analysis

I warn you though I personally don’t trade this set up on lower timeframes - so if your looking to day trade or scalp I don’t how the results would be.

There are other strategies on my blog too, if you have any questions just message me here - although blog comments are always appreciated

You’re the best