The following contains spoilers for the first 8 episodes of WandaVision.
The MCU's Wanda Maximoff has experienced a lot of death and tragedy in her life, from the loss of her parents, to the death of her twin brother, to the death of her true love, Vision. It was the death of Vision and loss of support in her life that caused her to create the circumstances that kick off the events of WandaVision. While WandaVision can be fun, comedic, and mysterious, it ultimately follows Wanda's journey and the depth of her love and grief.
With the exploration of Wanda's grief comes a better grasp of the range of her abilities. While Wanda has always been known to be one of the most powerful Avengers, WandaVision really emphasizes the scope of her powers and what she is capable of. Characters throughout the series have expressed amazement at what she can do, with Pietro even asking her how she did it. Wanda herself seems unsure.
Episode 8, "Previously On..." brings the questions about Wanda's power to the forefront. Agatha Harkness, the witch who was calling herself Agnes, can't figure out exactly how Wanda is maintaining the spell or how she is so powerful. In going through Wanda's memories, she discovers more about her powers. In a historic moment, Agatha refers to Wanda as her comic book moniker, Scarlet Witch, for the very first time in the MCU.
Episode 8, "Previously On..."
After the reveal of Agatha's identity and of her role in the story at the end of episode 7, this episode opens in Salem in 1693 with her backstory. She was put on the stake by her coven, including her mother, because she was accused of betraying her coven by doing black magic and breaking their rules. Agatha states, "I did not break your rules, they simply bent to my powers." When the coven tries to destroy her with magic, she absorbs it instead, making it clear she is an extremely powerful witch. This scene does more than explain Agatha's backstory, it sets up the pieces for the rest of the episode; that Agatha is a very powerful witch and yet she cannot break Wanda's spell or explain how she is doing it, and that the usual rules of magic can be broken if the witch is powerful enough.
Agatha uses a spell to travel with Wanda through her memories in order to understand where her powers originate from, especially when it becomes clear to her Wanda was never trained. Previously, Wanda and everyone else believed that HYDRA experimenting on her with the Mind Stone is what gave her powers. However, in going through her memories, Agatha and Wanda realize that Wanda had unconsciously done a spell to keep a bomb from killing her and Pietro as children. The Mind Stone amplified powers that would have otherwise laid dormant, but didn't award them to her. This means she is a witch, as Agatha is, and also can explain why her powers are often tied to her emotions, as seen in Avengers: Age of Ultron and Avengers: Infinity War.
Wanda and Agatha reach the moment where Wanda first arrived in Westview--then just a normal town in New Jersey--discovering the plot of land Vision had bought for the two of them to live on together before he died. Wanda's grief overcomes her and bursts out into an explosion of power and magical energy, revealing that she not only transformed the town, but created Vision out of her own magic. Agatha says to her after witnessing this, "You're supposed to be a myth. A being capable of spontaneous creation." She tells Wanda that this is chaos magic and "that makes you the Scarlet Witch."
"Scarlet Witch" Foreshadowed
WandaVision dropped several hints throughout the season that the show would lead to Wanda claiming the title of "Scarlet Witch." In episode five, Hayward asks Jimmy Woo, "Does Maximoff have an alias? No funny nickname?" to which Woo responds, "Not a one." Until episode eight, Wanda had never been referred to as Scarlet Witch at any point in the MCU. Another hint was Darcy calling the force field that surrounds Westview "the hex." Wanda having magic and being the Scarlet Witch gives this name a double meaning; it refers to the hexagonal shape of the force field but also to it being a spell, which can be known as a "hex."
Wanda has been associated with the color red throughout WandaVision. Her magic is red, as opposed to the purple magic used by Agatha or the blue magic used by Agatha's coven. Alongside her red hair, there is red in at least one of her outfits in every single episode where Wanda is seen in color. She is even seen driving a red car in her memories when she drives to Westview for the first time. This is taken most literally in the Halloween episode, where Wanda is dressed in the Scarlet Witch costume that the character wears in the comics. She says then that she is dressed as a "Sokovian fortune teller," and the costume does indeed foretell that she will finally be referred to as Scarlet Witch.
This episode is an important moment in Wanda's journey throughout the MCU. She has fulfilled her comic book destiny in a way, finally being referred to by her comic book name and learning exactly how powerful a witch she is. This doesn't mean that Wanda's journey is over, however. Between the upcoming WandaVision finale and her confirmed appearance in Doctor Strange and the Multiverse of Madness, there will be a lot more to come from Wanda Maximoff. Audiences will have to wait and see exactly what she does as not only Wanda, but as the Scarlet Witch.
WandaVision is currently streaming on Disney Plus.