Following Friday’s sell signal/break below the bearish rising wedge pattern, QQQ just hit the previous reaction low (where T1 was hit), with the odds for a minor reaction elevated although I still favor more downside to at least T2 & most likely much more. Previous (Friday’s) and updated 60-minute charts below.
QQQ 60m Dec 29th
QQQ 60m Jan 2nd
While the odds for at least a minor reaction here are elevated, my preference is to sit tight & not attempt to game a bounce on the long side as I suspect any rally could get sold into just as it starts to get going. For those looking to add to an existing short position or initiate a new short (or reverse back to short if gaming a bounce here), objective resistance levels would be just shy of the 406.32ish minor resistance and/or just below the top of today’s gap (Friday’s close).
Those that are near-term and/or longer-term bullish could, of course, buy today’s 1½% dip, as one of the largest drops in weeks or even months, although another leg down to T2 would be even better, given the fact QQQ only just broke down below the big 60-minute rising wedge on Friday & appears to have quite a bit more downside IMO.