medium · Volume Spread Analysis wyckoff-phases-schematics

If you are following a simple trending system and the index shows multiple signs of distribution, but your individual stock continues to close higher, what is the best practice?

  1. Sell the stock and buy the index at its new lows.
  2. Ignore the index and stay long until the individual stock closes lower.
  3. Tighten stops and prepare to exit, as the index weakness will eventually pull the stock down.
  4. Short the stock because the index has already peaked.

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