HLF Update-Possible Trade

Remember the short squeeze idea in HLF and a lot of you were making money, especially once we saw the pattern, BUT this was a large short by smart money and they came right out and admitted it which they would only do if it helped them.

I said multiple times last week, the unwinding of the short position is being handled expertly, there's no squeeze, no momentum allowed to build, you either take early profits, lose a chunk of them or have open risk for no good reason.

Well they were up to something when they told everyone how big their short was, I speculated they may go right back after HLF as they think these multi-level marketing companies are in for trouble.

It looks like they may have been doing exactly that, lifting price a bit and re-establishing or adding to a short position.

Take a look at the charts...

 In one update we identified the short positions as having been taken long before the December plunge.

 It was a bit tricky and as I suspected, as soon as a pattern became evident, it would stop working, look at the rest of the market today and HLF's relative performance, not good.

 1 min chart leading negative.

 I believe this 2 min chart shows EXACTLY where they covered, they didn't let on about the short position until after this, or at least not how big it was. So they could have not only covered, but picked up some long exposure to sell to those who were jumping in on what they thought would be a huge short squeeze (built in demand-whicjh also allows them to sell short again in to higher prices and demand).

Today we have a small intraday positive divergence so I'm hoping we get a pop above today's highs, that would make for a potentially interesting short entry.

 The 5 min chart also shows that initial leading positive divergence, yes I believe they covered right there at the lows and made people think they were still heavily short days after. Look at the leading negative divergence today, the 5 min chart is where the underlying trade starts to get serious.

And the 15 min went from confirmation to a leading negative divergence even with the downside pressure. We don't want to chase this, but we do want to be on the lookout for higher prices, even if only for an hour and double check our divergences and we may very well have an interesting short play if the shares are available.