Gabrielle W

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April 24th, 2020

 

The Wyckoff Undercut And rally

 

 

What is a Wyckoff Undercut and Rally? 

 

A Wyckoff Undercut and Rally occurs when an up-trending stock breaks below its moving average and/or the prior low but closes above the moving average and/or prior low. The price will undercut the moving average/prior low, faking out sellers and short-sellers, before rallying back above it. At this point, you can place your stop loss slightly below the new low. 

 

Yesterday, we saw this in Gilead Sciences (GILD)

 

Clarity can be found with moving averages on the chart. (12 EMA, 26 EMA, 50 MA, 200 MA)

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