Morning Trend | After Snowflake's heavy sell-off, will the shorts continue to dominate? Is a rebound window coming?

Yesterday, Snowflake (SNOW.US) experienced a significant decline with high trading volume, and attempts to rally during the day were repeatedly thwarted, indicating a clear suppression of short-selling sentiment. On the funding side, there was a predominant outflow of large orders, with intense long-short battles, and short-term sentiment has approached a freezing point. Such a volume drop often signifies a large amount of floating shares being sold off, and some traders believe this has entered a "post-cleansing of chips, possibly nearing a rebound point." After hours, there was noticeably more chatter in the community about bottom-fishing and seizing rebound opportunities, but it remains unclear whether the main players have truly entered the market.

From the market observation, SNOW oscillated around the previous support level throughout the day, with some funds attempting to support it, but were pushed back by selling pressure at higher levels. The daily line has moved far from several dense moving average zones, indicating extreme short-term overselling. The lower band of the BOLL channel was breached but quickly pulled back. Technical traders are generally waiting for further contraction in volume and signs of a bottoming out, while short-sellers are concerned about the depletion of downward momentum, making short positions less advantageous. Additionally, options data shows that short positions have not significantly increased, and there are signs of cautious short covering in the afternoon, with some observing funds gradually positioning for rebound opportunities in the intraday battles.

There are currently no new negative news developments, and the main logic for the decline stems more from earlier mediocre earnings guidance and a gap from high market expectations, compounded by institutional rotation outflows creating a magnifying effect. The prevailing view is that if SNOW stabilizes with reduced volume today, or if there is a clear low-buying support during the intraday session, the rebound window could be triggered at any moment—especially if there are unusual fund movements during the day, as the main players' covering actions could likely trigger a T+0 short-term buying spree. However, if there is continued high-volume selling today that breaks below yesterday's low, caution is warranted for a potential downward search for a bottom, which would again test market holding sentiment.

Overall, SNOW has entered a sensitive area of critical long-short balance. If you are a rebound player, it is advisable to only take light positions for testing, paying attention to unusual intraday movements and the interplay of volume and price. If the main players initiate a "reversal rally," it could trigger a rapid short squeeze; those with a more conservative style should wait for clear signals of volume stabilization before considering increasing positions. After all, the current intraday variables are significant, and the notion that "after a significant drop, there will naturally be a rebound" often requires a funding trigger point for buying in the case of SNOW