QQQ Blow-Off Tops

A blow-off top is a rapid, almost vertical rally fueled by FOMO, followed by a sharp reversal; basically, when buyers exhaust themselves all at once at the highs

• Steep, accelerating candles
  
• Price goes near vertical with increasingly larger green candles
  
• Little to no pullback along the way
  
• Climactic volume
  
• Volume spikes dramatically; often, the highest in weeks
  
• Sign that everyone rushed in at once
  
• Psychological level tag
  
• Often happens at a round number (QQQ $600)
  
• Big funds sell into retail chasing that breakout
  
• Immediate reversal
  
• After tagging the high, price reverses sharply
  
• Often leaves a long upper wick or a big red candle the next day
  

In a normal pullback, price runs up, consolidates, dips a little, then continues trend

• That parabolic sprint to $602 had some blow-off energy, but volume confirmation & follow-through matter
  
• If QQQ holds $596–$598, then just a pullback
  
• If it slices through $596 to $592 quickly, then the $602 peak was likely a blow-off top
  

1. November 2021 (~$400)

• QQQ ran up nearly vertical into the end of November
  
• Volume surged, RSI > 80 (extreme overbought)
  
• Next sessions was a sharp reversal & that marked the all-time high for over a year
  

2. July 2023 (~$388)

• A straight-line rally into mid-July
  
• RSI & stochastics pinned high
  
• Daily candle with a long upper wick, then a red engulfing candle the next day
  
• QQQ retraced ~5% quickly
  

3. March 2024 (~$448)

• Blow-off type move in tech earnings season
  
• Price overshot resistance, then reversed hard within 2–3 days
  

QQQ currently reached ~$602 & setup looks similar

• Strong parabolic run from ~$584 to $602 (+3%)
  
• RSI was pushing toward overbought
  
• Yesterday's red reversal candle below $600
  
• If QQQ closes below 596, we’d have a failed breakout
  
• Breakdown candle after a parabolic leg
  
• High probability that $602 = short-term blow-off top
  
• If it holds $596–$598 & bounces, then it’s just a consolidation, not a true blow-off
  

QQQ below $596 confirms the blow-off, while above $598 it’s still possible to rebuild

• Blow-off top = acceleration up + exhaustion candle + fast reversal
  
• If $596 breaks with volume, signals sellers are in control
  

1. $592–$593 (prior breakout shelf)

• Textbook first downside target after a blow-off peak; often, where dip-buyers step in
  

2. $587–$588 (last pivot low before the parabolic run)

• If blow-off confirms, this is a high-probability magnet
  
• Stretch Downside (full retracement of blow-off leg)
  

3. $584 (base of the September run)

• Would imply the parabolic move unwinds fully
  
• Only in case of heavy selling/broad market risk-off
  

Daily close below $596 confirms a blow-off top

• RSI roll-over from overbought with price under $596 = momentum shift
  
• Volume spike on red candle = strong confirmation that $602 was exhaustion
  
• If $602 was a blow-off top, QQQ’s clean retracement ladder is $592-$596, $587 & $584 (short-term, medium-term & stretch)