Market Analysis for May 20th, 2005

A few minutes ago the Q's made another marginal new intraday high at 37.59, and although this represents the 4th consecutive UNCONFIRMED intraday higher-high since Wed.'s high at 37.36, the Q's exhibit little or no selling pressure or profit-taking. In fact, judging from the enclosed daily chart, the Q's are sitting right at the 50% recovery point of the entire decline from the Dec. high at 40.68 to the April low at 34.35. Right now, neither the significance of the 50% recovery resistance plateau nor the multiple intraday upside momentum non-confirmations appear to be of ANY concern to the holders of long positions. Nonetheless, my work argues against holding long positions "up here," and instead, favors holding small short positions into this PM's option expiration. A decline below 37.20 remains the key to any forthcoming sustained weakness. MJP 05/20/05 11:05 AM ET (37.53)

Mike's QQQQ Diary is Outperforming Nasdaq by nearly 1500 Basis Points in 2005!
Sign up for a free 30-day trial.

  • Action-Oriented Trade Set-Ups in Stocks & ETFs
  • Macro Analysis of the Broader Markets
  • Detailed Technical Guidance for each Trading Idea
  • Live Interaction w/ Mike & Our Member Community
  • And Much, Much More!
Join Now! - Special Offer!
Veteran Wall Street analyst and financial author, Mike provides detailed and timely analysis and trade set-ups on a range of markets. Read more...

Have Mike's “Out Front” morning analysis delivered FREE to your email inbox twice weekly!