PSY — preliminary supply, where large interests begin to unload shares in quantity after a pronounced up-move. Volume expands and price spread widens, signaling that a change in trend may be approaching.
BC — buying climax, during which there are often marked increases in volume and price spread. The force of buying reaches a climax, with heavy or urgent buying by the public being filled by professional interests at prices near a top. A BC often coincides with a great earnings report or other good news, since the large operators require huge demand from the public to sell their shares without depressing the stock price.
AR — automatic reaction. With intense buying substantially diminished after the BC and heavy supply continuing, an AR takes place. The low of this selloff helps define the lower boundary of the distribution TR.
ST — secondary test, in which price revisits the area of the BC to test the demand/supply balance at these price levels. For a top to be confirmed, supply must outweigh demand; volume and spread should thus decrease as price approaches the resistance area of the BC . An ST may take the form of an upthrust (UT), in which price moves above the resistance represented by the BC and possibly other STs before quickly reversing to close below resistance. After a UT, price often tests the lower boundary of the TR.
SOW — sign of weakness, observable as a down-move to (or slightly past) the lower boundary of the TR, usually occurring on increased spread and volume . The AR and the initial SOW(s) indicate a change of character in the price action of the stock: supply is now dominant.
LPSY — last point of supply. After testing support on a SOW, a feeble rally on narrow spread shows that the market is having considerable difficulty advancing. This inability to rally may be due to weak demand, substantial supply or both. LPSYs represent exhaustion of demand and the last waves of large operators’ distribution before markdown begins in earnest.
UT — Upthrust.
ICE — This is another concept that isn’t covered in all distribution schematics but I feel it’s worth covering. Accumulation has a Creek and when price crosses this creek it’s considering to be Jumping Across the Creek (JAC). The creek is a rough line drawn across the highs of the range that we expect to see broken on high volume to add credibility. Within distribution we have a similar concept called ICE. Imagine this as a frozen lake, each footstep you take on the ice it becomes a little weaker. A rough line is drawn across the lows of the range instead for distribution, each time the price has touched it, it weakens and sooner or later the ICE will break and price (and you on the lake) will fall through.

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