SDS - The MACD Slap Shot Signal

From August 26, "SDS: Broken Indicators...Broken Systems:"

At yesterday's new low in the SDS, the MACD pulled back to the signal line, and it's positively diverging with price. The MACD is at -1.889. The signal line is at -1.924, so it's poised for a "slap shot" to the upside, like a puck sliding into the hockey stick, and then....WHACK...slapshot to the upside.

Yesterday's candle in the SDS is a Bullish Hammer, but it's only bullish with upside confirmation. Initial confirmation of anything bullish for the SDS would be a print high of 43.28, above yesterday's high.

The SDS still in freefall, knife-catching mode. Anyone who has been caught with his/her hand in the cookie jar has gotten it slapped very severely, but this setup could be good for at least a pop to the upside, and possibly more if it can print 43.28 and continue higher.

CAUTION: Knife-catching can be dangerous to our wealth. I don't make recommendations. As always, if we play anything, USE A STOP."

The SDS got a pop on that signal, but it was good for only a "One Day Wonder" rally in the SDS. The MACD still is showing a positive divergence, but as we discussed last month, positive divergences without price confirmation can be very misleading.



The SDS still is making new lows.