Skip to content
GetProfitable
Search
Dictionary

Distribution

A phase in which large holders sell into strength inside a range after an advance, keeping price stable while transferring inventory.

The mirror of accumulation. After an uptrend, price stalls in a range while supply quietly meets each attempt to rally. The chart looks healthy to anyone watching only the trend, because no decline has happened yet.

Cues traditionally cited are rallies on falling volume, wyckoff-upthrusts above the range that fail, and increasingly weak responses to good news. Breadth measures like the advance-decline-line failing to confirm new index highs are the market-wide version of the same idea.

Same warning as accumulation: the label is usually applied after the break. Treat distribution as a hypothesis that must be paired with a level that invalidates it, not as a reason to short a trend that is still making higher highs.

Related: accumulation, wyckoff-distribution, wyckoff-upthrust, advance-decline-line, trading-range

See it drawn

Original diagrams for the ideas on this page. Illustrative, not real market data.

A range beside a trendOne chart swinging between a flat floor and ceiling, another stepping upwards inside a pair of sloping lines.Range-boundresistancesupportprice bounces between two levelsTrendingthe trend channelhigher highs and higher lowsA range has two flat edges; a trend has two sloping ones.
Range versus trend. On the left price keeps bouncing between the same floor and ceiling, which is a range. On the right each high and each low is higher than the last, inside a pair of sloping lines called a channel.

Educational only, not advice. Spotted an error? Post in Site Feedback.