## The 5 Phases (A-E)

The phases are described in Villahermosa's Part 6 chapters (Ch.21–25). The phases are always numbered and defined conservatively — a structure should not be classified until the events confirm its type.

| Phase | Name | Book Chapter | Description | Events | Trading Opportunity |
|-------|------|-------------|-------------|--------|-------------------|
| 0 | Unknown | — | No structure identified | None | Wait |
| 1 | A — Stop | Ch.21 | Previous trend stops; first signs of accumulation/distribution appear. The market transitions from trending to lateral. | PS, SC, BC, AR | Prepare to trade range; identify initial extremes |
| 2 | B — Build Cause | Ch.22 | Range develops; the cause is built. Secondary tests confirm absorption. Volume typically contracts throughout this phase. | ST | Identify range extremes; observe tests for bias signals |
| 3 | C — Test | Ch.23 | Spring or UTAD shakes out weak hands. The market probes the opposite side before committing to a direction. | Spring, UTAD | Entry on shakeout reversal; highest-conviction event |
| 4 | D — Trend within Range | Ch.24 | Price moves directionally within the structure toward the breakout edge. LPS/LPSY retests occur. | LPS, LPSY, SOS, SOW | LPS/BUEC retest entry; SOS/SOW breakout entry |
| 5 | E — Trend out of Range | Ch.25 | Price breaks out definitively and trends beyond the structure. The cause has produced its effect. | Confirmed SOS/SOW beyond structure | Trend continuation; re-accumulation/re-distribution entries |

---