August 5, 2011,
Shares of the ETF Powershares QQQ Trust (NASDAQ: QQQ) have declined to critical support levels. Time to buy?
On Thursday, August 4, the QQQ sold off to within a fraction of its previous correction closing lows at $53.79. The Qs closed at $54.17.
When panic hits the markets and a 4+% one-day selloff qualifies as a panic, it is often time to buy though the trade may be a risky one.
For those with nerves of steel, a buy with a sell stop one-percent below the prior correction lows would protect on the downside yet give a trader a great shot at an early rally tomorrow morning.
Of course the chance of a global market selloff tomorrow exists so there is, as we wrote above, risk in the trade.
The Fibtimer.com (http://www.fibtimer.com) ETF Timing Strategy holds a position in the Powershares QQQ Trust.