NAS/QQQ Weekend Look (Jan18-21)

Here is the weekend look for the NAS/QQQ going into the trading week of Jan 18 -21. Last week started at the low the month & half trading range. Price fell Sunday night below the key 15492 level and continued to flush lower Monday morning. Price made and intraday low of 15152 (bottom of neutral) and then reversed sharply retraced more that 400 points to close slightly in the green. Price followed through on Tuesday and Wednesday, but then met resistance at the red box (see last week's weeks post) only to fall back down 400 points closing out the week at 15595. So a complete round trip over the 5 trading days.

It was positive that despite the big flush down the NAS held the key 15492 level. Going into this week if price fails to hold above the 15492 expect a retest of the recent flush low. The NAS often re-tests lows before continuing higher so I would not be surprised to see price visit the 15152 zone again. As always I will lean bullish above the neutral (tan box) and lean bearish below. The levels above the neutral can be used as targets for longs and seen as resistance until broken. The levels below the neutral can be used as short targets and seen as support until broken.

The general sentiment towards the technology sector and growth stocks is very bearish. However, as I have mentioned in the past few posts, the NAS is trading in a large sideways range and price has not yet confirmed the bearish bias. Best to tune out the noise and focus on the price. There is no defined trend until a key level is breached and price confirms one way or the other with a higher high or a lower low. In this NAS environment it is best to trade technology names less, keep the trades shorter and lower your risk. Once a new trend has been confirmed we can become more aggressive in the technology sector. Choppy sideways markets can be account killers.

Weekly Events...


Bank earnings will drive the narrative
Tuesday... GS & SCHW earnings
Wednesday... Housing starts + BAC,MS,PG,UNH,AA, UAL earnings
Thursday.. Jobless claims & Oil inventories + AAL,UNP,CSX,NFLX,EDU earnings
Friday... SLB earnings

Bullish notes...

Earning season begins
NAS held range low last week
Poor retail number may soften rate hike fears.


Bearish notes...

Weak retail numbers
Disappointing bank earnings
Potential spike above 2% in 10y yields
Inflation fears
Tapering fears.
Russia/Ukraine tensions

Comentarios:

Bearish price action coming into the Monday open. Price has retested the longer term trend line and moved lower. Also, a double top will confirm if the key pivot is taken out. If the key pivot is breached the Oct low is in play. A move back above the downward trendline would be positive.

Comentarios:

Price dropped below the key level of 15152 overnight. So far it was just a flush below taking out stops. If the low holds expect a push higher If the low is retested and fails expect move lower.

Comentarios:

The overnight low did not hold and the NAS closed below 15152 confirming the double top. Price is now below the neutral and in the bear zone. A test of the Oct low is likely. NAS also closed 10% below ATH putting it in an official correction.