The PO3 in crypto Trading

In this post i will analyse the term PO3 in crypto (and not only) trading.

Table of contents

1. Accumulation, Manipulation, Distribution
2. Bullish and Bearish PO3
3. How to trade PO3
4. Formation of PO3

1. Accumulation

Accumulation is a phase in the market where smart money or institutional investor are buying.

During accumulation, the price is relatively stable, creating an impression of little activity.

Behind the scenes, investors are accumulating.

High bullish volume.

During this phase, large institutional traders and MM begin to build positions in anticipation of future price movements. This stage creates a base of support or resistance.

1.2 Manipulation:

Manipulation refers to intentional actions taken by smart money to control/influence the price for their benefit

Unusual price spikes/drops that don’t align with fundamentals, may suggest manipulation

As deviations below supports with a big buying pressure

The Manipulation phase is where the market becomes more volatile and unpredictable.

During this phase, large players attempt to move the price.

In a way that triggers retail traders’ SL and creates liquidity for their larger positions.

1.3 Distribution:

Smart money start selling their accumulated positions, after making new highs.

During distribution, the price may exhibit weakness or struggle to move higher, after a big uptrend

Volume might increase, but price progress is limited or declining within time

The distribution phase is where the large players who accumulated positions begin to sell.

A clear trend begins to emerge in the direction of the institutional traders’ positions.

Trading volume typically increases as more market participants join the trend.

2.1 Bullish PO3

Is conformed by;

1. Accumulation: Longs are building up and price is in a range.
2. Manipulation: Market sells of below the range, creating liquidity
3. Distribution: Price expands upwards, breaking MS with strong bullish candles and bullish volume

2.2 Bearish PO3

Is conformed by;

1. Accumulation: The price enters in a range
2. Manipulation: The price aggressively rallies above the range, creating liquidity above last highs
3. Distribution: Price expands downwards, breaking the MS with strong bearish candles

3. How to trade PO3

• Let the price RANGE in Accumulation.
• Wait for a Manipulation and a “stop hunt” below range.
• Place a LONG position when price takes the next Bullish FVG as support.
• MS should be HH and HL to hold your position.
• Take TP in DOL

4. Formation of PO3

As you already know, we can categorize PO3 in Bullish or Bearish. This are the formations of each one of them. Study how price is formed. Memorize this market structures.

Credit to : CryptoSoulz (@SoulzBTC)