Interesting fact if true (and thanks for passing along the fact that the stat could not be verified). My take is that A) yesterday gap will be backfilled and that B) If & when it is, the market will likely start sliding very impulsively.

Part of my logic lies in the fact that Friday’s low on the QQQ was the second clear breakdown below the key 116.00 level, with the breakdown starting on Tuesday with continued selling into Friday’s lows which stopped essentially at the same level in which the early Sept false breakdown below 116.00 (the bottom of the 3 month sideways trading range). Therefore, we’ve now had not one but two false breakdowns which in a market with more buyer than sellers would normally result in a powerful & sustained move higher as false breakdowns are bear traps (powerful fuel for rallies).

The bulls weren’t able to capitalize on the last fake-down & while maybe they do end up taking the market to new highs following this one, if they don’t, I think that will be a clear sign that the supply/demand dynamics in the market are steady shifting to more sellers than buyers. Putting all that aside for a minute, following Friday’s retest of the Sept 12th low on QQQ, the Q’s have no business retesting that level anytime soon & a backfill of yesterday’s gap will have taken the Q’s right back there at which point I think it will become clear to nearly all that the supply/demand dynamics have now clearly shifted to the point where the buyers are now outnumbers by the sellers. In other words, should yesterday’s gap get backfilled, unlike many backfills, which then see prices reverse once the gap is backfilled, I think that we’ll smash right through the Sept 12th/Nov 4th lows in QQQ. Heck, even entering the top of the gap at QQQ 115.30 has the potential to trigger an impulsive wave of selling.