NASDAQ 100 (QQQ/NDX) correction in progress but new highs after!

NAS100USD
NDQ
QQQ



The explanations on the charts are self-explanatory.

Bottom line: MACD is not diverging and animal spirits still powerful in NASDAQ especially - despite the coronavirus panic which is temporary and an excuse for a correction that was long overdue anyway.

Compare to the chart of Feb - Mar 2000 of Dot-com crash in NASDAQ 100 which had a long period of rising prices diverging from falling MACD.

The ultimate high IS NOT in place yet!

However, the current drop IS in 5-waves and IS impulsive so this is NOT the end of this correction!

We will have a bounce starting shortly in wave B of the correction which should retrace 50% or more of the gap. There are other target areas confluencing in that area which I have indicated on the chart.

Then we should have a final wave C of the correction which will most likely be an ending diagonal 5 waves ending in the confluence area I have shown.

The rise to new highs will begin then.

I had placed a QQQ Bear Put spread trade (Long March 20th 220 Put, Short March 20th 200 Put) last Tuesday and I have unwound that position and bought March 20th QQQ 220 calls today before market close.

I will look to sell those call when QQQ reaches 220-225 and buy April 20th 200 Puts to the final drop.

Assuming these work out the time to load up on May 20th calls 230 QQQ when wave C ends with diverging momentum indicators (RSI) and hold these to new highs.

Best of luck everyone :)