This pre-market bounce to the 401 resistance level offers another objective shorting opp for active swing traders with a relatively tight (~2%) stop or a wider stop (~6-8%) for trend traders to allow for a marginal new high before the next leg down. Stops ideally based on an hourly or daily candlestick close. 60-minute chart below with the pre-market session trades in white.
QQQ 60m Dec 16th
Ditto for /NQ as it makes yet another test of the key 16424ish resistance level. Have to say I’d almost favor at least a brief stop-clearing pop above these levels, even if we are going lower although that may or may not happen. Either way, a solid & sustained break above this level is likely to open the door for more upside in the near term. As such, active traders using tight stops could also re-enter should any breakout today or tomorrow later fail as with the previous failed breakout in mid-November.
Also, how the Nasdaq 100 and S&P 500 close the week might also help to give us some insight as to where the markets are headed from here in the coming weeks to months so less-active swing & trend traders that are currently short the indexes might opt to sit tight & give those positions a little room to see how we close the week.
NQ 60m Dec 16th