Wyckoff Analysis, Nails It

The last report on China, FXI, stated we’re in a Wyckoff set-up that was about to be tested.

More specifically, it said the leveraged inverse fund YANG, was in ‘spring’ position; ‘spring’ is opposite of up-thrust, because we’re looking at shorting the FXI, via inverse fund YANG.

Back then, two charts were provided with the most probable outcome of the set-up. One showed a ‘pass’ of the test and one showed ‘fail’.

Well, it’s obvious now; pass it is.

The original hourly chart is repeated below with the current chart (ninety minutes into the session) following.

Leveraged FXI Inverse YANG, Hourly

Prior to the ‘test’.

And now … ninety minutes into the session:

Back in the day, over a century ago, Wyckoff wrote that ‘somebody always knows something’ and that ‘something’ shows up on the tape.

What we in the Proletariat didn’t know last week, was this week, would bring us this report from ZeroHedge.

The important part is that Wyckoff analysis allowed one to see what was happening (on the tape) and position ahead of time (not advice, not a recommendation).

Positioning

The prior report on FXI contained the following:

“Risk on a position short FXI via YANG (not advice, not a recommendation) can be reduced by allowing YANG price action to retrace as much of the opening gap as possible.”

That’s exactly what was done with an entry made near the lows of the day.

For the haters (if any), here’s a reproduction of the entry exactly as it appears in the trade account:

Check for yourself if you like, that YANG was at 10.95, right around 10:51, a.m. EST.

The low of the day occurred several minutes later at YANG 10.90. The stop is set just below that low @ 10.89 (not advice, not a recommendation).

The trade’s identified as TDA-YANG-22-01. The ‘TDA’ references that a separate account (TDA Ameritrade) is being used for this position.

Hopefully, that’s enough ‘transparency’ and we can move on.

The Wyckoff Edge

Properly done (without being skewed by personal bias), there’s nothing else needed other than Wyckoff analysis.

It’s important of course, to understand the context of our (global) environment such as ‘everything’s going according to plan’ but allowing the mainstream to influence the analysis, other than providing a contrarian view, is an absolute waste of time.

Stay Tuned

Charts by StockCharts

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