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It’s All About the Q’s, the Q’s…not the SPY

In the last update showing the SPY 60-minute, I was neglect in not mentioning, as I did in Monday's Awaiting These Sell Signals on the QQQ & SPY post, that until the leading index, the $NDX / QQQ breaks down, that the rest of the US indices aren't going down very far without the lead dog that has been pulling the sled for months & even years now. Here's the updated 60-minute chart of the QQQ with what we need to see before we get a green light (or red light, depending if you are long or short) along with Monday's QQQ chart (I've since removed the upper-most TL & added a few more support/target levels).

I should have pointed out that the Q's were flirting with that key 60-minute uptrend line when I posted the SPY update earlier but I was so wrapped up in the 5 & 10 minute charts of QQQ that I forgot to check my "60". The Q's did briefly overshoot that wedge but as I often state, only the 60-minute candlestick closes matter when trading off a 60-minute time-frame. So far, they buyers have stepped in at that TL but I still believe that a breakdown & substantial move lower are imminent at this point (although so far, the market has already topped on Tuesday & so I believe that we are already most likely well into the very early stages of a correction).

Nov 6, 2015 10:55am|Categories: Completed Trades - Short, Equity Market Analysis|Tags: , , |3 Comments

3 Comments

  1. Profile gravatar of jabraham
    jabraham November 7, 2015 9:38 am at 9:38 am

    Hi,
    Regarding shorting the Q’s, since decay is an issue, would PSQ be a good option?

    With appreciation,
    jabraham

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    • Profile gravatar of rsotc
      rsotc November 9, 2015 8:18 am at 8:18 am

      PSQ would definitely be a good option for shorting the Q’s since it is not leveraged (-1x QQQ), especially for those wanting to short in a IRA or non-margin account that does not allow shorting. I chose to short TQQQ as the proxy for the current QQQ short trade because I think it has the potential to morph into a multi-week or multi-month swing trade and if so, by shorting the 3x long vs. buying the 3x short (SQQQ), the decay should work in my favor, rather than against me. QID (2x short QQQ) would also be another option with less decay than SQQQ.

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      • Profile gravatar of jabraham
        jabraham November 9, 2015 8:34 pm at 8:34 pm

        Good stuff, thanks!

        0

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