QQQ: It has reached an inflection point - D & W chart analysis.On the daily chart, a series of gaps show intense selling pressure. The downward trajectory and the pattern of lower highs/lows suggests sustained bearish sentiment. However, a significant gap was closed recently, at 487.21, followed by a slight bullish reaction indicating some buying interest at lower levels.
The problem is that the trend is still bearish, as the price is still below the 21-day EMA, and we don't see any bullish chart structure yet (aka higher highs/lows). Therefore, any rally could be a Dead Cat Bounce, if the QQQ fails to break its resistance level at the 21 ema on the daily chart.
Switching to the weekly chart, the emergence of an evening star pattern—a strong bearish reversal indicator—highlights a potential trend shift after making a record high.
This pattern typically signals the exhaustion of a bullish trend and the commencement of bearish momentum. Following this pattern, a considerable pullback occurred, moving the price back below the 21-week EMA, which shows a lot of weakness.
These charts suggest caution. The bearish indicators recommend preparing for potential further downsides if the gap support at 427.81 fails to provide the necessary support. Its next support is at 413.07. But, if the QQQ confirms a bottom signal above this support level, it could trigger a rally to itts 21 ema on the daily chart, and then we'll see how to proceed.
Today's reaction is interesting. Let's follow the QQQ closely.
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