The "Qs" Follow Our Script To A "T"
by Mike Paulenoff
September 12, 2020 • 12:40 PM EDT
On Sep 2, with QQQ trading at 300.01, down nearly 4 points from its pre-market thrust to a new all time high at 304.02, Mike Paulenoff alerted MPTrader members to the potential danger signals lurking within his chart work. He wrote:
"Just in case TSLA and AAPL weakness represent the first shot over the bow ahead of a significant correction in the NDX, my work on QQQ indicates that a break and close under 298.00 will trigger sell signals that project to 280."
Within hours of Mike's warning, the Qs had sliced beneath 298.00, triggering sell signals in his work that pointed to 280.00 next. (See chart below.) The Nasdaq 100 ETF proceeded to roll over into a nasty nosedive on Sep 3 and 4, just ahead of the three-day Labor Day holiday weekend, pressing beneath Mike's initial target of 280 to a Sep 4 low at 271.80.
By Tuesday Sep 8, QQQ reached a lower corrective low at 269.66, nearly 10% beneath Mike's sell signal at 298.00, and 11% beneath its all-time high of 304.02 from Sep 2.
Mike continued to closely follow QQQ and its key consequential components AAPL, TSLA, and AMZN during the remainder of this past week.
On Wednesday Sep 9, with the Qs at 275.31, Mike wrote: "My BIG picture pattern and momentum work argue that the decline from the 9/02 high at 304.02 to last eve's low at 269.66 (-11.3%) has unfinished business on the downside after this recovery bounce runs its course. The closest target zone for the QQQ rally is 276.20/80, with the optimal target zone being 280-283 ahead of another loop down that breaks 269.66 in route to the 250 area."
QQQ followed Mike's script, recovering to 282.20 within his target zone the very next morning before looping down as he anticipated, breaking his 269.66 support en route to a new corrective low at 266.90 on Friday afternoon.
What's in store for the Qs this coming week?
Join Mike's Trading Room and find out!
Mike Paulenoff is the author of 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 7-day Trial!
More Top Calls From Mike
On March 13, amid a broad discussion about the emerging bull phase developing in the precious metals and miners, Mike Paulenoff posted this about WPM (Wheaton Precious Metals) to our MPTrader discussion room:From a more Silver-Gold perspective (if FCX is perceived to be Copper-centric), let's notice that WPM strength is pushing up against its near-term resistance line in the vicinity of 45.
Right after the opening bell on the morning of October 20, 2023, Mike Paulenoff posted the following GLD (SPDR Gold Trust) commentary to our MPTrader Discussion Room:"For all of the long-suffering Gold Bugs... As we speak, GLD is attempting to take out key 5-month resistance lodged between 181.20 and 184.40, which if successful and sustained, will point GLD to 188-190 next... Last is 183.88...
During the afternoon session of February 15, this is what Mike Paulenoff posted to the MPTrader Discussion Room about the technical setup in the oil service company SLB (Schlumberger):"This name in the oil service sector exhibits a well-demarcated 4-year bullish channel with the SLB price structure upturning off of the lower boundary line in the vicinity of 47.00 (the 2/13/24 low) amid a glaring double non-confirmation of the weakness into the lower channel line.
On December 26, 2023, fellow MPTrader member FJB asked me the following question: Mike - do you feel comfortable giving some of your top sectors for next year if you have any? This was my response:In order of preference based on my technical setup work:1- XLV (Healthcare)2- XLB (Materials)3- XLE (Energy)4- XLI (Industrials)5- XLF (Financials)As of the close this past Friday, 3/15/24, YTD results showed XLV +6.58%, XLB +6.15%, XLI +7.06%, XLF +8.54%, and XLE (Energy) leading all sectors, at +9.27%.
On February 23, Mike Paulenoff posted the following timely commentary about the bond market to MPTrader members:"Benchmark 10-year YIELD and TLT (20+ Year T-bond ETF)-- I am getting initial, but very strong technical signals that the backup in 10-year YIELD from the late-March low at 3.78% to yesterday's (2/22/24) high at 4.35% is nearing exhaustion ahead of a rollover into another downleg within the larger downleg off of the October 2023 high at 5.00% (see my attached Daily Chart).