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Strategies & Market Trends : Ask Vendit Off-Topic Questions -- Ignore unavailable to you. Want to Upgrade?

To: Gush who wrote (8364)	5/4/2005 8:42:11 PM
From: Walkingshadow	Respond to of 8752

Hi Gush, Volumes look encouraging, and the technicals do not suggest exhaustion yet. QQQQ is not overbought. The candles are bullish: 139.142.147.218 So far, so good; more upside looks very likely here. But how much? Well, there is trouble brewing overhead, before we get to the upper BB rail. The upper rail sits at $36.87, but it is dropping. However, the 50 sma is at $36.35 and dropping. And the 200 sma currently is at $36.50. Then there is chart resistance at $36. stockcharts.com[w,a]daclyyay[dc][pb200!d20,2!f][vc60][iLg!Lyb20,2.0]&pref=G (added edit): And also there is resistance at roughly $36.20 from the upper rail of the regression channel that defines the medium term correction we are coming out of. 139.142.147.218 So, from top to bottom, here are the resistance levels: Upper BB rail: $36.87 200 sma (horizontal): $36.50 50 sma (sloping down): $36.35 Regression channel rail: $36.20 Chart resistance: $36.00 I think QQQQ will get turned back between the 50sma and the 200 sma (at about $36.35 - $36.40). The upper BB rail at that time will probably be closer to $36.50 as well, and QQQQ could reach that level intraday, but not on a closing basis. I just don't think QQQQ has enough upward momentum to charge through these very significant resistance levels on this attempt. This will happen, but not yet. I have other reasons for believing this, including the volume patterns; we are just not there yet, there has not been a sufficient accumulation of motive force to drive a rally that will take us through very solid resistance levels. Market internals are also consistent with this interpretation. In fact, internals strongly suggest that tomorrow and maybe the next day will be flat or down. The intraday chart shows QQQQ to be overbought with sell signals in place: 139.142.147.22 So: I anticipate over the next day or two, QQQQ will pull back some. Then, it will again rally to test the resistance levels as specified above (these will change a bit during that time). Next, it will fail at that heavy resistance, and drop back down to successfully test the lower support levels that have been established recently. All this should take 5 sessions or so, perhaps a bit longer. After that, we will see another run at resistance. If volume patterns develop favorably, that next test could well be successful, but right now it is too soon to tell. If not, then an additional round or two might be required. T