Mon Jan 29th 2007
For the past several hours, the Nasdaq 100 Trust Shares (QQQQ) have created a base-like pattern around the 43.50 area, which to me looks and acts like the preceding decline from the Jan 16 high at 45.47 is over. If that proves to be the case, then we should expect a recovery rally period that pops the Q’s to test the Jan resistance line at 44.15 and then makes a run at more important resistance at 44.50. Having said that, however, I do not expect the Q’s to climb to new highs. Rather, after the current recovery rally runs its course, I will be looking for 42-41 thereafter. Bottom line: looking for a place to get short the Q’s and/or long the QID’s.
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