Don:" T/A Chat 'n Chew "
RE: QQQ - NDX-100 Index
...this ain't very scientific {grin} but, in the past I have noticed that when the NDX gets near the top of its apparent trading-range channel = TechSector "cycle", it tends to creep on upwards in a series 3-candlestick, "evening star" (or other, reversal) constructs that ultimately fail to become major down-waves.
Folks who adopt a paranoid/adversarial market view might call this persistent betrayal of apparent reversal sentiment, "Bear Traps". A rationalist might conclude that different index sector/sub-sector components are peaking at different times, producing a series of stepwise, "evening stars" on the overall index chart.
One of the things that characterizes these stepwise, failed reversal patterns is that mo goes flat; sto rolls around up there in the sky - and the index grinds forward. (if you don't have a momentum indicator on your chart, you can simulate one by using a very slow stochastic, say - 2x, 3x or, 4x your typical %K sto duration)
Usually, NDX-100 tops out, and I see this pattern - during earnings churnings : one day MSFT is popping, and on another day, CSCO, etc. It is more uncommon to see this (right now) without news-driven, ballistic up-thrusts in the Tech bellwethers. However, we could say that two such 3-candle constructs with "evening star" aspects have already happened: 03/07/08-SEP; then, 09/10/13-SEP.
imho, it would not be surprising to see it happen again: 14/15/16-SEP... tommorow, then, (or 15+16-SEP sum if the market is slow) may be some form of "spinning" or "shooting star" : yet another, stepwise ascent with (failed) reversal sentiment aspects.
When my QQQ - qubes daily chart mo indicator goes flat, I revert to the 18d EMA - this is at ~121.7 right now (QQQ closed today at ~125.4)
Should QQQ drop ~3.7 points, it would be one heluva downwave, for sure (^_^) But, so long as QQQ CLOSE remains above its 18d EMA - we must continue to assume that the current, intermediate UpTrend remains intact.
QQQ :
far-target = ~131
near-target = ~128
...at 125.4 CLOSE today...
horizontal support/resistance = ~123
18d EMA = ~121.7 = intermediate UpTrend
fib at ~119.5
50d EMA = ~117.5
fib at ~115.25
near-support @ ~113.5 = YTD UpTrend area
-Steve
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