Who this entry is for — What a point-and-figure chart is and why Wyckoff uses it to measure how far a stock can move after a trading range.
Source: Wyckoff Analytics; Stock Market Institute tradition. Wyckoff drew P&F by hand alongside bar charts.
Prerequisites
Trading volume, Three Wyckoff laws (cause/effect).
Definition
In plain terms — Ignore time and volume. Mark only when price moves enough to «count». The result is a grid of X (rises) and O (falls) showing structure without daily noise.
Point & Figure (P&F) records only price changes above a threshold (box size), ignoring time and (in classic form) volume.
| Element | Meaning |
|---|---|
| X | Rising column |
| O | Falling column |
| Box size | Minimum move to add a mark |
| Reversal | Boxes needed to reverse column (e.g. 3-box) |
Why Wyckoff uses it
In the Wyckoff method, P&F serves the cause/effect law:
- Cause = horizontal count in the trading range
- Effect = extension of the move leaving the range
Example — An accumulation range with 12 P&F columns and a €1 box size: the vertical projection suggests a minimum target of +€12 from the breakout point — to be compared with known resistance.
P&F vs bar chart
| Bar chart | Point & Figure | |
|---|---|---|
| Time axis | Yes | No (price only) |
| Volume | Visible | No (classic) |
| Wyckoff A–E | SC, spring, SOS events | Cause count |
| Nine tests | Structure, volume | Targets, tests #1 and #9 |
Use both together on the same range (Wyckoff count procedure).
Summary card
| Wyckoff role | Cause/effect ruler |
| Not | An automatic buy/sell signal |
| Deep dive | Wyckoff P&F count procedure |