Undercut and Rally Setup Explained in Swing Trading
Most traders get stopped out right before the biggest move of the year.
They watch the stock flush below a key level, hit their stop, and then stare at the screen as price immediately reverses and runs 30%, 40%, 50% without them.
It feels like the market is personally targeting you.
The truth is, it kind of is.
And today I am going to show you exactly how to be on the right side of that move.
…
A long X post teaching the undercut-and-rally setup: a leader dips under a watched level (the 20- or 50-day, a prior high-volume close), runs the stops under it, and closes back above within one or two sessions on volume; buy the reclaim, stop under the undercut low, at least 3:1. It is the classic Wyckoff spring with no backtest behind it; the examples (NVDA, MU, BE, NBIS) are winners picked after the fact. Filed to the concept library as undercut-and-rally (folk, proposed).