Jun 20

Current Weakness in Q's Should Find Nearby Support

by Mike Paulenoff, Wed June 20th, 2007

At this point it certainly looks as though this morning's pre-open new high in the Nasdaq 100 Trust Shares (Nasdaq: QQQQ) at 47.95 ended the upleg off of the 6/13 low at 46.44, but right now NOT the upleg off of the 6/08 low at 46.08. There is a subtle but huge difference in which of the uplegs is ending. If I am correct and just the 6/13 upleg ended, then current weakness should find support between 47.50 and 47.25, prior to another thrust to new highs above 48. However, if the 6/08 upleg has ended, then the 47.50/25 support area is unlikely to contain the decline, and the Q's will be vulnerable to a much more significant bout of weakness that at the very least will test key intermediate-term support between 46.10 and 45.90, which if violated will signal that a meaningful peak is in place. So, based on my calculations, much could be at stake here during the upcoming hours.
Chart

Mike Paulenoff is author of www.MPTrader.com, a real-time diary of his technical analysis & trade alerts on ETFs for precious metals, energy, currencies, and an array of equity indices and sectors, including international markets, plus key ETF component stocks in sectors like technology, mining, and banking. Sign up for a Free 15-day Trial!