Wyckoff Wave Still In The Midst Of A Correction

The Wyckoff Wave opened Monday sharply lower, then rallied into Thursday, before succumbing to a selloff on Friday.  For the week the Wave was up slightly.   Volume gave no strong clues during the week, but showed some supply still present.

The Technometer spent the week trading near neutral and finished Friday slightly above neutral.

Volatility picked up on Monday’s selloff and then settled back down to close slightly lower for the week.  VIX closed the week at $12.37.

The S&P and Nasdaq Indices were both up .75-1.30% for the week.

The Wyckoff Wave traded sharply lower Monday at the opening and finished unchanged.  This was a spring on the daily chart, but it was a spring in a downtrend which you want to always be careful with.  The Wave proceeded to trade higher into late Thursday, before turning lower on Friday to end the week.

The Optimism – Pessimism Index has continued to lead the Wave lower, and last week showed no strong desire to rally.  Supply has stayed present during last week as no strong buying came in on the rally.   The 5 minute intra-day O-P line chart below has last weeks action to the right of the blue vertical line.  You can see the O-P did not participate in last weeks rally and closed the week slightly lower again.

The Force Index continues to trade at low levels as well and applying pressure to the downside.  You can see the daily Force on the above chart.

Since the O-P and Force continue to show relative weakness, and the Technometer is trending to Overbought, we think the upside is limited here.  We expect to see more downside in the week ahead in the Wyckoff Wave.

We still have shorts on various stocks that continue to show relative weakness versus the general market.  For our ProTraders we are short GE, CAT, and PX and will be looking to add to shorts early in the week.   Last week we put out a bulletin on possibly stocks to buy on our next Wyckoff Wave buy signal.  Please click here if you would like to become a Pro Trade Member.

The bond market was down slightly for the week.  We are standing aside awaiting clarity.
We have made the Wyckoff Unleashed Course more affordable to possible students.  We have added an option of paying for the course in six easy installments of $189.99.  We are trying to build the Wyckoff community and hope this easier pay option helps!!
Click here for more info…
We have also just upgraded our server, so you will see much faster load times moving forward as you navigate the site!
Good Trading,

Todd Butterfield