Stocks opened sharply lower…
With stocks opening sharply lower, we took the opportunity to cover our recent short positions in SPY, XLE, and VNQ. We gave the trade update on our Twitter account to try and show people that the Wyckoff Tools are very helpful when it comes to their day to day market operations.
Our Wyckoff Technometer was coming down into the “Oversold” territory, and we felt like we could make a short term bottom and relieve the oversold condition of the last five days of selling pressure. On our 5 minute WWU/OP intraday line chart, the OP was not making new lows the last 3 days, as the price was continuing to make new lows. With this divergence in place, we felt like we could possibly bottom for a snap back rally, and that is why we covered our short term short positions.
Stay tuned for our next updates….