In today's session, we are observing a textbook Drop-Base-Drop supply formation on the QQQ 15-minute chart, signaling a strong shift in intraday momentum from bullish to bearish.
Here is a breakdown of the price action and what to expect next:
1. The Initial Rejection (The First Drop): After a steady pre-market climb and an early push off the open, buyers failed to sustain the momentum above the 603 level, creating a weak high. Sellers aggressively stepped in, forcing a sharp impulse move down. This initial drop was significant because it aggressively sliced through the $600 psychological Key Level (KL - 600), trapping early breakout buyers.
2. Consolidation and Distribution (The Base):
Following the drop, price entered a brief consolidation phase right around the 599 - 600 area. This "Base" is crucial. It represents a temporary pause where buyers attempted to reclaim the $600 level but were absorbed by resting sell orders. The inability to push back above this psychological pivot confirmed that supply was in control.
3. Structural Shift and Continuation (The Second Drop):
The breakdown from the base resulted in a clear Change of Character (CHoCH), officially breaking the bullish structure we had carrying over from the pre-market. The second leg down confirms the bearish continuation pattern.
What to expect next:
For intraday scalps and short setups, the "Base" now acts as a fresh, high-probability supply zone. Any low-volume retracement back into the 599.50 - 600.00 area should be heavily monitored for signs of exhaustion (wicks, lower highs on the 1m chart) to execute continuation shorts.
Always wait for confirmation and manage your risk strictly.
Here is a breakdown of the price action and what to expect next:
1. The Initial Rejection (The First Drop): After a steady pre-market climb and an early push off the open, buyers failed to sustain the momentum above the 603 level, creating a weak high. Sellers aggressively stepped in, forcing a sharp impulse move down. This initial drop was significant because it aggressively sliced through the $600 psychological Key Level (KL - 600), trapping early breakout buyers.
2. Consolidation and Distribution (The Base):
Following the drop, price entered a brief consolidation phase right around the 599 - 600 area. This "Base" is crucial. It represents a temporary pause where buyers attempted to reclaim the $600 level but were absorbed by resting sell orders. The inability to push back above this psychological pivot confirmed that supply was in control.
3. Structural Shift and Continuation (The Second Drop):
The breakdown from the base resulted in a clear Change of Character (CHoCH), officially breaking the bullish structure we had carrying over from the pre-market. The second leg down confirms the bearish continuation pattern.
What to expect next:
For intraday scalps and short setups, the "Base" now acts as a fresh, high-probability supply zone. Any low-volume retracement back into the 599.50 - 600.00 area should be heavily monitored for signs of exhaustion (wicks, lower highs on the 1m chart) to execute continuation shorts.
Always wait for confirmation and manage your risk strictly.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.