QQQQ topping

Discussion in 'Stocks' started by dtrader98, Nov 13, 2006.

  1. This is sort of an addendum to a thread i've been posting to on a possible QQQQ top.

    The QQQQs look bounded by a broadening range for the short term daily.

    The longer term weekly broke down through the long term major diagnol support and had an impulse leg back to test that support line. If it doesn't break it upwards, the path of least resistance appears to be back down. Looks like a classic bull trap IMHO.

    Hate to fight the uptrend, but at least the technicals support this bull trap/broken diagnol support thesis.
  2. shorter term broadening range. Today is looking like it wants to blast through it to the upside. But as long as the top support line holds, it's still intact.
  3. Should also pont out that the weekly aslo looks like a major cup and handle.

    The reason I choose to see the more bearish view at the moment, is because of economic/macro environment:
    1) yield curve inversion is strong predictor of recession and stock market drop.
    2) Large COT commercials short position is heavily divergent to non-commercial funds positions.

    One things for certain, we are at a major inflection point on the long term chart.
    Can't make any certain decisions as the short trend is up, however, I find it hard to see the long view considering the macro environment.
  4. with caveat that market seems to enjoy ignoring all data and reality currently... i can't believe what i am reading everyday on the reuters wire yet the market continues to march higher...

    i have long exposure but am really disturbed by the whole thing...especially the dow where this charge is being led by GM - the shittiest, most bankrupt stock on the market in an industry that is dying...
  5. IMO, it will be kept high long enough for the big boys to unload at a good price.
  6. well today I bought 120 jan. 07 43.00 puts.....i see it as risking 1 point upside with 2-3 points to the downside on this trade...i know the nasdaq has been carrying this market the past week especially.....but I will profit atleast .10 cents per contract as the volitility of the qqqq makes for nice exit points even if the news doesn`t clobber the etf over the next 2 months!