Tech Stocks

This chart highly suggests that capitulation and peak fear is finally here.

This is the chart of SQQQ, which is the inverse derivative of QQQ, which in turn tracks the Nasdaq 100. There's virtually no way that SQQQ's price can sustain a gap up like this on a weekly time frame. The gap is extremely likely to close and the price will move back below the Ichimoku Cloud resistance by the end of the week. Those who are just now selling tech and growth stocks because of inflation are capitulating. Inflation and rate hikes have been evident in the charts for over a year, and it, therefore, makes no sense to just now be selling tech.

See my post here for why I believe this is the bottom for tech:

With this said, if SQQQ does indeed close the week above the Ichimoku Cloud resistance and EMA exp ribbon then we're looking at a market crash. Statistically, this is highly unlikely to be the case though. The NDTH is far too low for QQQ to break down and crash just now. We are in peak fear/peak inflation/peak capitulation this week. In fact, this is a super good risk-to-reward entry. One can enter TQQQ/QQQ/tech this week and stop out on Friday if support breaks at the weekly close. If support holds, you would have bought in at the absolute bottom.

If the Fed hikes rates by 75 bps on Wednesday, it's quite likely that the markets will quickly rally from this low.

Not financial advice. Anything can happen. Trends can break.

Comment:

Just to clarify, I titled this post "Tech Stocks" and then put a Short call. What I mean is that my short call is for SQQQ and that Tech Stocks are definitely going to rally soon.