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Strategies & Market Trends : Playing the QQQQ with Terry and friends.

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To: Walkingshadow who wrote (4805)	8/2/2010 8:24:05 PM
From: Walkingshadow	2 Recommendations Read Replies (1) of 4814

QQQQ has bounced nicely off a critical support region defined by the 50sma and 20sma. Today the index gapped up impressively, and closed right at the next resistance level (the 100sma). Now the index is immediately faced with another region of resistance formed by the 100sma (just above today's close), chart resistance at $47.00, and the upper rail of the BBs (currently $47.18). So this resistance zone is from $46.70 to $47.18. I believe the index will rise to around $48. If no volume develops, then the index could drift higher than that, possibly as high as $49. But I don't think the tremendous technical damage done to the index in early May will be overcome. So my prediction is that the index will approach the old highs of late April, but will not surpass them. After that, I think we'll start a major bear market in earnest. There's no shortage of bad news for the talking heads and financial press to point to as the "cause." And I suspect that the giddiness of earnings season will begin to wear off just about the time the index is approaching the old highs, and will be replaced by doom and gloom that won't go away any time soon. WS

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