One hell of a day in the market today. The market opened higher then sold-off. However, the markets rallied hard with about a half hour left in trading. My guess is the market hit some technically important levels. The QQQQs started rallying at 49 and the SPYs at 142.50. Considering the heavy volume, this makes sense.
However, notice the SPYs still aren't above the horizontal support line from about a week ago. There is also the downward sloping resistance line from the last few days. Now, it's possible the markets open tomorrow with an upward spike to clear both of these resistance levels. But...
Notice on the daily chart we're still below the 200 day SMA with the shorter SMAs moving lower still. It is possible to look at today as a selling climax. Notice the heavy volume, which is usually a sign of a climax. Obviously, we'll have to wait and see tomorrow if that is right or not.
The 5-day QQQQ chart puts today's action in some much-needed perspective. The lower trendline is pretty obvious. I've eyeballed the top one which could be in a few other spots. But the bottom line is the QQQQs are stuck in a bit of an overall range right now, trying to figure out what to do.
The daily charts makes the range a lot more obvious. The QQQQs could be forming a bottom hear. This would make sense considering the heavy selling action the index saw last week.
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