Hi DaGushman,
Yes, as anticipated the lower BB rail has been pushed down and has now opened somewhat (from 1.3 to 1.6). But it is still very contracted:
stockcharts.com[w,a]daclyyay[dc][pd20,2!b50][vc60][iLyb20,2.0]&pref=G
And yes, I think there is a lot of indication that we will now see a relief rally.
That said, we haven't seen the last of the BB expansion to the downside. I think the likely scenario is a rally, slight contraction of the BBs, then QQQQ will blow that lower rail open much wider as it fails at the support levels outlined in many previous posts.
Regarding the relief rally, there are other resistance levels, and I don't think QQQQ will get anywhere near $38.29 on this relief rally.
First stop is the 20 sma ($37.29). I think that is a likely reversal point. But there is a lot of important economic news out this week, much of it expected to be good. So there is a chance QQQQ might have enough momentum to make it through the 20 sma.
If so, there is the descending 50 sma at $37.53. After that, there is trendline resistance just above at about $37.60 or so.
I can't see QQQQ getting any higher than that. But remember, there is a zone of very heavy resistance beginning at about $38.01 that has convincingly turned back some fairly good rallies in QQQQ. If QQQQ gets that high, it will be pretty overbought, and momentum very likely exhausted, so I see no way for QQQQ to make it up to $38.29, even on an intraday basis.
If long QQQQ, and if it trades above the 20 sma, I think a stop just under the 20 sma would be wise.
....all IMHO, of course.
T |
