Double Top QQQ Euphoria Is Likely Ending

Summary

  • We are seeing a double topping process in the stock market, and QQQ in particular, with falling volumes, that might be a signal the current bull run is ending.
  • Recent market action—a rally, sharp correction, and V-shaped recovery—aligns with my forecast for a roller coaster year.
  • High valuations combined with flattening growth signal potential for more choppy markets and possibly a bear market ahead.
  • I recommend investors reassess portfolio risk and consider asset allocation changes, such as reducing QQQ exposure, to prepare for a possible market downturn.
  • This idea was discussed in more depth with members of my private investing community, Margin of Safety Investing. Learn More »

hard times in stocks

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This piece is from a monthly update series to my "Quarterly Outlook & Game Plan," called "Macro Dashes," that members of Margin of Safety Investing receive. I hope you find it useful.

In my 2024 forecast

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Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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