QQQ - Dip buyers are about to catch a falling knife

Yesterday, our price targets of 305 USD and 300 USD were reached. After that, the relief rally began, and QQQ erased some of its earlier losses. However, we expect the bounce in the QQQ to be short-lived. Accordingly, we remain bearish on QQQ and expect it to continue lower after the rally ceases; small time frames suggest this thesis as they slowly start to reflect overbought conditions. Therefore, our new short-term price target is 295 USD; the new medium-term price target is 290 USD (due to become a short-term price target once 295 USD is taken out).

Illustration 1.01

The picture above shows QQQ on the daily chart in pre-market on 10th May 2022. The downward sloping trendline acts as resistance.

Technical analysis - daily time frame
RSIs bearish structure remains intact. MACD and Stochastic remain bearish. The same applies to DM+ and DM-. Overall, the daily time frame is bearish.

Illustration 1.02

Illustration 1.02 shows that the weekly volume continues to increase, which is bearish.

Technical analysis - weekly time frame
RSI, MACD, and Stochastic are bearish. The same applies to DM+ and DM-. Overall, the weekly time frame is bearish.

Please feel free to express your ideas and thoughts in the comment section.

DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not serve as a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.

Trade active:

The idea was updated in the following post:

Trade closed: target reached:

Our price target of 295 USD was reached.