July 22, 2010
Shares of the ETF Powershares QQQ Trust (NASDAQ: QQQQ) reversed from important resistance on Wednesday, July 22.
Last week the Q’s reached $45.81 intra-day before reversing and heading lower. The Q’s stopped at $43.86 on Tuesday, July 20 and reversed to the upside. Tuesday was a bullish outside reversal day for the Q’s though the decline they ended was not a strong one.
On Wednesday, July 22 the Q’s quickly rallied to $45.76, just five cents below the high reached last week and that was it for the rally. By the close the Q’s had shed almost 1.5% and closed at $44.64.
It appears that there is a line in the sand at $45.81. There is also support at $43.86. A close below $43.86 in the next few days would likely result in further declines to test the $42.00 level.
A close above $45.81 would erase Wednesday’s Bernanke inspired selloff and launch the Q’s for a retest of the $47.00 level.
Whichever way this goes, the daily volatility is high and any trades are risky. There is no definitive trend but there is a bias to the downside.
The Fibtimer.com (http://www.fibtimer.com) ETF Timing Strategy holds a position in the Powershares QQQ Trust.
Disclosure: The Fibtimer.com (www.fibtimer.com) ETF Timing Strategy holds a position in the Powershares QQQ Trust.