Using the QQQQs as our guide, it looks like the 2 month bull run is over. Key support was broken at approximately $33.60. I expect this to move down to the next fib line at $31.70.
To really get things moving, 880 will need to be broken on $SPX ($88 SPY).
Price momentum is also breaking down as evidenced by RSI readings. Notice that the QQQQs have not been at this level on RSI since early/mid March.
Now comes the hard part. 880 is clearly an important level. Should this be played as support or should we be preparing for a breach and a move down to 800?
Let’s look at some of the more important ETFs for clues.
I am looking to see if IYT can hold support at $52. I took a little of my short position off the table today in response to the index approaching this support level.
XME was a disaster today. We had a little false breakout and crashed right through support today. Lucky for me, I got stopped out at $34.29 before things really got ugly.
XRT is looks like it is heading right back to support at $23-24. Notice the huge surge in down volume on both XME and XRT. I shorted this near $29, so I covered a little more of my XRT short today as we start getting closer to support.
If we do get a bounce off of 880, then perhaps KWT is a good place to be long.
I would potentially be interested if it bounces off of $13. Definitely a tight stop.
Still loving UNG even though I am not in it yet.
This is why I am in love with UNG. First, nice little double bottom off of $12.50. Second, look at the recent volume surge. Third, all of this comes after a 1 year downtrend and the break up over that trendline. UNG is a beautiful chart and should go into a charting textbook. I am looking to buy off my 23.6% fib line and off support at $15.55.
Typical day for ESI. This stock always seems to do well on down days and tends to underperform when the market is up. My 61.8% fib line continues to hold up as strong resistance.
Today’s trades:
- Added HMSY long.
- Stopped out of XME.
- Stopped out of BSY.
- Covered a small amount of IYT.
- Covered a small amount of XRT.
- Trimmed FAZ back to original position size.
- Added XLU long.
- Covered a little NFLX.
- Added FXC long (keeping a tight stop – not so enthused with this position).