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Strategies & Market Trends : Playing the QQQQ with Terry and friends. -- Ignore unavailable to you. Want to Upgrade?

To: IHateSourCream who wrote (646)	6/6/2005 1:34:53 AM
From: Walkingshadow	Respond to of 4814

Hi IHSC, <<Do you think the downtrend will continue from Friday?>> Yes. The intraday 5 min chart shows that QQQQ clearly failed at intraday support from the 40 ema. Technicals suggest the intitial move at the open will be up, but quickly followed by a continuation of the trend from Friday. As of now, the e mini Naz futures are trading slightly up, but this is very early trading and is of limited value. Personally, I'd rather see QQQQ open slightly up and make an initial move to the upside and find sellers there. That will all but ensure that the rest of the session is down. 139.142.147.22 Market Internals: After rising for the first half of the month of May, the 13 sma of the $TICK has been dropping. Friday, the $TICK dropped rather precipitously, but has not reached an extreme low as of yet. So I suspect it will continue falling into the open tomorrow: stockcharts.com[w,a]dallyyay[db][pb13][vc60]&pref=G The $TICKQ is a bit delayed, but shows essentially the same thing: stockcharts.com[w,a]dallyyay[db][pb13][vc60]&pref=G The $TRIN is rising, and now it's 13 sma appears also to be reversing upwards: stockcharts.com[w,a]dallyyay[db][pb13][vc60]&pref=G This can be seem more clearly on the $TRINQ: stockcharts.com[w,a]dallyyay[db][pb13][vc60]&pref=G The $VIX appears to have stabilized on support now, and is looking like reversal has begun to the upside (meaning downward pressure on prices): stockcharts.com[w,a]daclyyay[db][pb13!c8][vc60]&pref=G The $VXN and $QQV are in agreement with this: stockcharts.com[w,a]daclyyay[db][pb13!c8][vc60]&pref=G stockcharts.com[w,a]daclyyay[db][pb13!c8][vc60]&pref=G After reaching somewhat of a bullish extreme at the beginning of June, the CBOE put/call has now been climbing: stockcharts.com[w,a]daclyyay[dc][pb13!c8][vc60]&pref=G So the market internals look to me to give a pretty consistent picture, and agree with the chart and technical indicators that QQQQ is headed down from here. Finally, volume patterns indicate considerable downward pressure on QQQQ, since there is a lot of unprocessed distribution volume that QQQQ must digest and react to sooner or later. The resolution of this volume buildup has already been delayed over a week, making things less and less stable, and making a stronger move down increasingly likely. T

To: IHateSourCream who wrote (646)	6/6/2005 1:46:39 AM
From: Walkingshadow	Read Replies (3) \| Respond to of 4814

Note also (FWIW) that light sweet crude futures are trading very strongly. As I write this, they are currently at $55.42. Note that the downtrend line in the stochastics has been broken to the upside, which tells me there is a change in trend taking place here. Although oil is overbought now, and will eventually pull back, I think there will be upward pressure on prices for the next several weeks: futuresource.com Note that overbought status is often maintained for quite a while with oil, which reflects the fairly strong uptrend. While I don't put a lot of faith into oil as a determinant of stock prices at this time, still this provides an almost irresistable "explanation" for the market movement that is strongly suggested by the charts, technicals, market internals, and volume patterns as detailed in my previous posts today. So the talking heads can crow that stock prices are going down "because" investors are nervous about the price of oil, raising the possibility of significant inflation and a shift in FOMC policy to a more aggressive stance. Never mind that the FOMC just got finished saying they are not worried about inflation and have no plans to change their plans. And the FOMC has never been known to change policy based on a mere week or two worth of speculative trading in a single commodity future, and I hardly think they'll begin doing so now. Still.... don't be surprised if you hear such blather from the talking heads next week. T