Rocket Lab and the Wyckoff cycle: accumulation, distribution, VPA, and the three laws

Rocket Lab and the Wyckoff cycle: accumulation, distribution, VPA, and the three laws

Richard Wyckoff’s method is not a pattern-recognition game. It is a way of reading who is in control of the tape. Large operators cannot buy or sell size in a straight line without moving price against themselves, so they build positions in ranges and campaign them in trends. Those campaigns leave footprints in price spread, close location, and volume. That is Volume Price Analysis. Wyckoff simply organised those footprints into a cycle and three laws. On the weekly chart, Rocket Lab in 2026 has printed a complete campaign: a first accumulation in the first quarter, a violent markup into a selling climax distribution top near $151 in late May, a markdown back into the same price zone, and a second accumulation through August and September.

That weekly structure is the map. The line of the year makes the same point even more clearly: base, blow-off, give-back, base again.

A note on language before we go further. The selling climax (SC) belongs at the top of the rally. It is the market makers selling to a greedy and voracious public eager not to miss out. The buying climax (BC) belongs at the bottom of a decline. Panic selling is in full flow and the market makers are filling up their empty warehouses. The full cycle runs: markdown → buying climax → accumulation → markup → selling climax → distribution → markdown. Rocket Lab has shown both climaxes this year.

The Composite Operator

Richard Wyckoff asked traders to imagine one intelligent operator standing on the other side of every order. That operator accumulates when the public is frightened and distributes when the public is greedy. The operator’s problem is size. To buy a large line, he must absorb panic without lifting price too soon. To sell a large line, he must feed stock into enthusiasm without collapsing price too soon. Ranges are the solution. Trends are the harvest. VPA is how you watch him work. You do not need an indicator for this. You need the candle, the spread, where it closed, and how much volume it took.

The three laws

Everything else in the method is an application of three statements.

1. The Law of Supply and Demand
Price rises when demand exceeds supply. Price falls when supply exceeds demand. Price goes sideways when they are roughly balanced. The useful question is not “is there volume?” but “which side is being absorbed?” A wide down-bar that closes off the low on huge volume at the end of a decline is not more selling to come. It is supply being taken. A wide up-bar that closes off the high on huge volume at the end of an advance is not more buying to come. It is demand being supplied.

2. The Law of Cause and Effect
A trend does not appear from nowhere. The range is the cause. The subsequent markup or markdown is the effect. A narrow, brief range generally produces a smaller campaign. A wide, long range generally produces a larger one. Point-and-figure traders count the range horizontally to estimate the objective. Even without a PnF chart, the principle is the same: the first-quarter work in RKLB was the cause of the May effect. The May–July distribution and markdown were the cause of the return to the old range. The August–September work is the next cause. Its effect has not yet been fully paid.

3. The Law of Effort versus Result
Volume is effort. Price travel is the result. When they agree, the campaign is healthy. When they disagree, control is changing. Harmony: wide spread, close in the direction of the move, expanding volume. Divergence: heavy volume, narrow spread, close in the middle or against the implied direction. That is absorption or exhaustion.VPA lives inside this third law. The classic tells:

• Climax: extreme spread, extreme volume, close off the extreme. Selling climax at a low. Buying climax at a high.
• No demand: up-bar, narrow spread, low volume. Rallies that cannot attract buyers.
• No supply: down-bar, narrow spread, low volume. Dips that cannot attract sellers.
• Absorption: high volume, poor result. At support, buyers are taking stock. At resistance, sellers are feeding it.
• Test: a return to the climax area on smaller volume. If the test holds, the opposite side is spent.

Those five observations, read in context of the range, are most of professional tape reading.

Rocket Lab, 2026:

The campaign on the weekly

Context first. The stock had already been marked up from the November 2025 low near $37.57. December closed near $70. January pushed as high as $99.58. That January spike was not the start of accumulation. It was residual markup from the late-2025 cause. The work that matters for this year’s first campaign is what happened after that spike failed.

January to March: first accumulation (a re-accumulation / corrective base)

January’s high near $100 could not hold. February worked a range roughly $64 to $81. March produced the selling climax of that correction: the $56.13 print on 30 March, with a close back up toward $64 by month-end. That is classic Phase A behaviour of a base. Panic travel to the low, then a close off the low. The public supplied stock. Someone took it.VPA read of that quarter:

• Effort on the breaks toward $64–$56 was large. Result at the close was often poor for the bears. That is absorption at support.
• Rallies inside the range were messy and frequently faded. That is Phase B: the operator is still building, not yet ready to mark it up.
• The March low tested the demand zone and held on a weekly basis. That is the ST/spring area of the first campaign.

Cause and effect:

Three months of work in the mid-$50s to high-$70s was enough cause for a violent effect once demand took control. April began the SOS. The month’s low was $61.86; the high was $93.10; it closed $82.51. Effort and result came back into harmony: wider upside spreads, closes toward the highs, expanding participation.

May: markup into a selling climax and distribution

May is the public’s chapter. The stock ran from the April launch pad to an all-time high of $151.00 on 27 May, with the month closing near $143. That is a selling climax in the Wyckoff sense or blow-off top: wide spread, urgent FOMO demand, and enough volume for the market maker to sell into and meet demand for the time being. But they are selling out! Clearing their warehouses. A round number does not define a climax.

It is defined by effort that can no longer produce a sustainable result. After $151, the result failed.VPA at the top:

• Maximum effort on the final push. A vertical rally to be matched with a vertical fall – the souffle effect as I call it!
• Immediate inability to hold the high. That is the first law flipping. Supply has arrived, and the market makers are almost done
• June high $135.6, low $80, close $101.65. That is the automatic reaction and the start of markdown. The effect of distribution begins as soon as the market makers have finished feeding the bid.

Call May what it was: a distribution blow-off. Not every distribution is a quiet three-month rectangle. Some are vertical. The operators and insiders use the public’s urgency as the exit liquidity. June volume was heavy. July was the washout month of the decline: high $107.6, low $58.20, close $64.95, a 36% monthly drop. Effort on the downside was large, and the result was large. Harmony to the bear side. Notice the important level. July’s low at $58.20 came back to the same neighbourhood as March’s $56.13. Cause and effect had returned price to the prior cause.

That is how campaigns often reset. August–September: second accumulation at the same level. August high $86.83, low $62.17, close $63.92. September so far: low $60.51 on 14 September, high $75.46, and the stock is now around $73.This is the second range at the first range. That is the point of the chart.

The operator who accumulated in Q1, distributed into May, and bought the markdown is working the same shelf again.VPA of the current range:

• Mid-September’s dip to $60.51 was a test of the July–March demand zone. It did not produce a new waterfall. The downside result was limited.
• 18 September was a wide down day to $64.57 on very heavy volume (~32 million). The following sessions reversed that weakness: 21 September closed $69.89 on another heavy print, and 24 September tagged $75.46. Effort that looked like supply was absorbed; result flipped. That is the third law at support.
• Subsequent strength into the mid-$70s has not yet produced a weekly SOS through the top of the August range near the mid-$80s. So this is still a range, not confirmed markup. Phase B or early Phase D, not Phase E.

Now we wait for the market makers to complete their accumulation operation, to fill their warehouses, and to begin the next phase of the new campaign. And remember, we may see a test, a low-volume test, before we break once more to the upside for a longer-term bullish trend.

This is how we teach volume price analysis in all our education programs, whether for stocks or forex. Volume price analysis is the bedrock of our coaching and mentoring programs, whether self-directed or one-to-one.

By Anna Coulling – creator of volume price analysis

By Anna Coulling – creator of volume price analysis