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Strategies & Market Trends : Steve's Channelling Thread
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To: Zeev Hed who wrote (19980)7/7/2001 11:51:16 PM
From: ajtj99  Read Replies (2) of 30051
 
Zeev, looking at the QQQ (and NDX and COMPX), it seems if we get a reversal of the downtrend tomorrow, the drop in the QQQ may not be as extreme as I previously believed (filling the gap below 37.80). Here's why:

I cannot see in the past year where a day's down move went significantly below the lower Bollinger band on an intermediate low.

For example, the QQQ went from a close of 59.125 on December 19 to a low of 54.75 on Dec. 20. The close on Dec. 19 rested on the lower Bollinger band, and the next day the low pierced it when it dropped 8%, but it was quickly reversed later that day and was up big the next day.

What I'm thinking is that the gap from April on the QQQ from 37.05 to 37.80 may remain un-filled this trip, and that the QQQ may go to 38.25 or 38.50. Similarly the gap in the NDX may go unfilled also.

That still gets us to close to 1850 on the COMPX, however, if it gets that bad, but it seems a strong reversal will also be in order.

What I'm postulating is that gaps that have been partially filled the same day they were created may remain that way unless the price gets extremely close (maybe within 1%). Gaps that remain completely unfilled may have a much stronger draw even when the price is twice that distance (2%).

Any experience or insights?

Here's the historical pricing on the QQQ going back to Dec. 2000:

chart.yahoo.com
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