Short

QQQ (NASDAQ) Stairs up, elevator down

Updated

The journey up over the last 3 months since early July was just erased over the course of the last week or so, with much of coming just in one day. Right at the 200 EMA for the close, but at the moment NQ futures further down below 7000. One scenario is a bounce from this level where past congestion lines up as potential support just below the 200EMA, and if it doesn't violate the bottom around 169 could see a short term bounce. Below 169 would wait for support further down before trying to catch this falling knife. Long play here would be tactical and countertrend to the more prominent trend which is now bearish.

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Friday brought the bounce, gapped open on overnight strength across all the indicies, but then the optimism faded a couple of hours into the trading day, only to return with an hour left to take price to opening levels. Seems the first bounce has appeared, but yet to see which way this is headed in the coming days. Wouldn't be surprised to see continued strength on Monday, only to fade either later in the same day or later into the week.

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Moving up with conviction today, but getting into short term resistance levels. Would take some profits here if playing the bounce. May continue higher to next level, but for tactical trading it would be a logical time to at least partially close short term long positions

Note

And it continues...Now starting to wonder if the recovery bounce is going to be more V-shaped or W-shaped. Would have thought the latter, but we're just one rally away from the former. Seems strong earnings have brought back some risk-on appetite, despite the backdrop of new potential uncertainties around the Saudi situation and how it may impact existing and future investments in the West. Maybe more noise than signal across the board, and rather just pay attention to the charts as price action plays out. Despite the stronger than expected move back up, still would be cautious, especially into this week's expiration Friday and early next week.

cch31

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