Here’s a look back to my last trade. I was buying SPY puts when the market made new lows in the morning at the break of the red line. I was stopped out for a loss and in retrospect I see some signs from the $ADVN as to why I should have taken the opposite side of this trade and bought calls. Below is a 5 minute chart showing the SPY and the $ADVN or the number of Advancing issues in the NYSE.
Comparing the two shows a diverging signal. The $ADVN was making higher highs and higher lows when the underlying SPY was attempting to make new lows, not a good confirmation of getting short. When the SPY broke to new highs around noon followed by the $ADVN breaking to new intra-day highs, this was confirmation that I needed to get long or stay long the SPY.