Hi JK,
You were absolutely right about QQQQ breaking $38; I couldn't see how they could possibly push it that high, but they sure did anyway. And yes, I agree there's a lot of short covering, especially at the dollar marks, and that has helped QQQQ up over the $38 level.
The obvious next move is professionals taking up short positions. Given the current market volumes, some well-timed short selling with a lot of size showing could really walk down the inside ask in a hurry and scare the shinola out of a whole lotta retail designated bagholders as they watch their recently purchased long positions lose money.
<<I hope tomorrow we get a gravestone doji with a nice long, upper shadow,>>
A nice long black candlestick with a shadow on top and heavy volume would be nice too!
<< I'll just continue lying in wait to unleash the rest of my shorting ammo>>
A very wise strategy, IMHO.
RE the $SOX; I don't think that is a triple-top. Rather, that is the upper boundary of a trading channel. It does not occur at the end of a runup, which is what you like to see in a triple-top. Instead, it occurs on the downside, after a runup:
stockcharts.com[h,a]daclyyay[de][pb9!b4!f][vc60][iUk12!Up5,3,3]&pref=G
Note the head and shoulders that was completed in May 2004; I remember posting about that a few times as it was developing in late 2003/early 2004. That I think is the failure pattern, and the trading range now represents the reversal/stabilization zone.
I thought the $SOX might charge through that overhead at the top of that trading range (about $445) after a correction that I thought would already have occurred, and be rather mild. Now it seems more likely to me that the $SOX will be so extended by the time it hits that upper resistance that it will have exhausted itself, and will get turned away. Eventually, it will clear this resistance, however. Maybe on the second attempt.
T |
