QQQQ weekly indicator is still strongly overbought

The Stock Market Week - 5/23/2008

All the major US indices were negative. For the week the Dow Jones Industrial Average dropped 507.17 points, or 3.91%. The Standard Poor's 500 Index dropped 49.42 points, or 3.47%, while the Nasdaq Composite dropped 84.18 points, or 3.33%.

Nasdaq Trend Analysis

Last week we expected that the resistance level at 50.6 should hold, and the QQQQ price might move down toward the support level of 48.08. The QQQQ reached 50.47 on Monday. Then price turned down losing 3.62% for the week and closed on Friday at 48.2.

QQQQ Long-term technical analysis: Our long-term outlook has not changed. We consider two possible scenarios: Scenario 1. The long-term uptrend (10/08/2002 - 10/31/2007) is over, and a new long-term downtrend started on 10/31/2007. The sub wave 2 (0/31/2007 - present) is currently in progress and almost completed. The sub wave 3 down should start soon and break the long-term support trend line around 43ᇀ, and then it'll go lower than the recent low of 41.05 and move down to about 35 in the late fall. Scenario 2. The long-term uptrend that started on 10/08/2002 is still in progress, with sub wave 5 currently in progress. The wave 5 is usually tricky. It might be truncated and form a double top pattern or not even reach the previous high - 55.07. Which scenario we are going to see may depend on how successful the FED's rate cut would be. The FED's market regulation supposed to weaken the upcoming recession, but FED should not use their power to turn the recession into a new bull market. If FED overdoes the rate cut, we may see the scenario 2. With this scenario, by the end of the wave 5 FED will not have enough room for a new rate cut, and the next long-term downtrend would be even more severe.

QQQQ - Long-Term Trend

QQQQ Short-term technical analysis: Weekly Lane's Stochastic is still strongly overbought, while daily technical indicators are neutral. The price has broken the rising channel support level. The QQQQ might see a brief rebound or pause, but the technical indicators and the wave structure for both long-term scenarios suggest that the downtrend may continue. Risk/reward ratio is high.

QQQQ - Short-Term Trend

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QQQQ technical indicators are overbought

The Stock Market Week - 5/16/2008

It was an up week for the major markets. For the week the Dow Jones Industrial Average gained 240.92 points, or 1.89%. The Standard Poor's 500 Index gained 37.07 points, or 2.67%, while the Nasdaq Composite gained 83.33 points, or 3.41%.

Nasdaq Trend Analysis

QQQQ Long-term technical analysis: Our long-term outlook has not changed. We consider two possible scenarios: Scenario 1. The long-term uptrend (10/08/2002 - 10/31/2007) is over, and a new long-term downtrend started on 10/31/2007. The sub wave 2 (0/31/2007 - present) is currently in progress and almost completed. The sub wave 3 down should start soon and break the long-term support trend line around 43ᇀ, and then it'll go lower than the recent low of 41.05 and move down to about 35 in the late fall. Scenario 2. The long-term uptrend that started on 10/08/2002 is still in progress, with sub wave 5 currently in progress. The wave 5 is usually tricky. It might be truncated and form a double top pattern or not even reach the previous high - 55.07. Which scenario we are going to see may depend on how successful the FED's rate cut would be. The FED's market regulation supposed to weaken the upcoming recession, but FED should not use their power to turn the recession into a new bull market. If FED overdoes the rate cut, we may see the scenario 2. With this scenario, by the end of the wave 5 FED will not have enough room for a new rate cut, and the next long-term downtrend would be even more severe.

QQQQ - Long-Term Trend

QQQQ Short-term technical analysis: Last weak we suggested that, if support holds, the QQQQ might reach the channel resistance. The QQQQ rallied from the support level and gained 3.73% for the week and reached 50.11 on Friday. The rally from 41.05 (3/17/2008) to 50.11 (5/16/2008) is close to Fibonacci 62% retracement. Weekly and daily Lane's Stochastic is overbought, while daily William's Percentage Range (W%R) is strongly overbought. MACD has bearish divergence. The rising channel resistance level is near 50.6. The resistance should hold, and the price might move down toward the support level 48.08.

QQQQ - Short-Term Trend

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QQQQ may reach the channel resistance level near 49.6

The Stock Market Week - 5/9/2008

Last week we suggested that short-term market outlook is negative All the major US indices were negative. For the week the Dow Jones Industrial Average dropped 312.32 points, or 2.39%. The Standard Poor''s 500 Index dropped 25.62 points, or 1.81%, while the Nasdaq Composite dropped 31.47 points, or 1.27%

Nasdaq Trend Analysis

QQQQ Long-term technical analysis: Our long-term outlook has not changed. We consider two possible scenarios: Scenario 1. The long-term uptrend (10/08/2002 - 10/31/2007) is over, and a new long-term downtrend started on 10/31/2007. The sub wave 2 (0/31/2007 - present) is currently in progress and almost completed. The sub wave 3 down should start soon and break the long-term support trend line around 43ᇀ, and then it'll go lower than the recent low of 41.05 and move down to about 35 in the late fall. Scenario 2. The long-term uptrend that started on 10/08/2002 is still in progress, with sub wave 5 currently in progress. The wave 5 is usually tricky. It might be truncated and form a double top pattern or not even reach the previous high - 55.07. Which scenario we are going to see may depend on how successful the FED's rate cut would be. The FED's market regulation supposed to weaken the upcoming recession, but FED should not use their power to turn the recession into a new bull market. If FED overdoes the rate cut, we may see the scenario 2. With this scenario, by the end of the wave 5 FED will not have enough room for a new rate cut, and the next long-term downtrend would be even more severe.

QQQQ - Long-Term Trend

QQQQ Short-term technical analysis: Weekly Lane's Stochastic is overbought. Daily MACD has bearish divergence. The price is near the short-term rising channel support line - 48.25. If support holds, the QQQQ may reach the channel resistance level near 49.6. This level is close to the Fibonacci 62% retracement. Overbought stochastic would make this resistance level pretty strong. If the price breaks the support line, the next support is at 46.6 and then around 45. The QQQQ may retest the long-term support around 42-43 as well. Overall risk/reward ratio is still pretty high.

QQQQ - Short-Term Trend

Presented by www.thegreedytrader.com Research Group.

QQQQ - MACD has bearish divergence

The Stock Market Week - 5/2/2008

It was an up week for the major markets. For the week the Dow Jones Industrial Average gained 166.34 points, or 1.29%. The Standard Poor's 500 Index gained 16.06 points, or 1.15%, while the Nasdaq Composite gained 54.06 points, or 2.23%. The QQQQ raised 3.44% for the week.

Nasdaq Trend Analysis

QQQQ Long-term technical analysis: Our long-term perspective includes two possible scenarios: Scenario 1. The long-term uptrend (10/08/2002 - 10/31/2007) is over, and a new long-term downtrend started on 10/31/2007. The sub wave 2 (0/31/2007 - present) is currently in progress and almost completed. The sub wave 3 down should start soon and break the long-term support trend line around 43ᇀ, and then it'll go lower than the recent low of 41.05 and move down to about 35 in the late fall. Scenario 2. The long-term uptrend that started on 10/08/2002 is still in progress, with sub wave 5 currently in progress. The wave 5 is usually tricky. It might be truncated and form a double top pattern or not even reach the previous high - 55.07. Which scenario we are going to see may depend on how successful the FED's rate cut would be. The FED's market regulation supposed to weaken the upcoming recession, but FED should not use their power to turn the recession into a new bull market. If FED overdoes the rate cut, we may see the scenario 2. With this scenario, by the end of the wave 5 FED will not have enough room for a new rate cut, and the next long-term downtrend would be even more severe.

QQQQ - Long-Term Trend

QQQQ Short-term technical analysis: In both scenarios the short-term perspectives are negative. Weekly Lane's Stochastic, daily Relative Strength Index (RSI) and William's Percentage Range (W%R) are overbought, and daily Lane's Stochastic is strongly overbought. Daily MACD has bearish divergence. Price is near the rising channel resistance line - 48.94. The chances are high that QQQQ will turn down soon.

QQQQ - Short-Term Trend

Presented by www.thegreedytrader.com Research Group.