One's Eyes Can Be Deceived

"One's eyes can be deceived. We see what we believe, not the other way around." -V.M. Varga, Fargo, Season 3 

ARKK is sporting an almost too-perfect short setup, seen below on the updated daily chart. 

Despite, or perhaps because of, Cathie Wood's latest buying spree the technicals have not improved the overall broken charts on multiple timeframes. You are now looking at a bear flag on unimpressive buy volume bouncing up to a prior broken support zone which should now function as resistance. 

Overall, ARKK entirely gave back its pandemic rally and is now trading at the same levels it did six years ago. While many argue that it simply cannot go down further from here, my view continues to be that a meaningful washout is ahead of us, not behind. Bottom-fishers see what they believe--That everything always seems to come back in this historically-forgiving market for bulls. 

As you might imagine, these types of short setups will likely work even better once the current relief rally slows down or reverses entirely. Given bearish seasonality and overall technicals the last five weeks on the indices, I continue to look for the latter scenario into September, which means ARKK remains front and center as one of the best short ideas around.