Nqshort
NQ cant reclaim the mid of the channelI know there are too many lines for some, but they are important to me. Just pay attention to the green trend channel and the blue doted mid of the channel line
NQ is supporting a view I have on the SPX, looking for some lower (NQ down to the low of the channel line before a fakeout.
NQ is short term bearish Main support zone! 12400 must hold on any test attempts for higher levels!
Im seeing this structure short term bearish, medium term is bullish.
A move down to 12100 is what Im looking to get hit before we continue higher to well above 13000
Supports:
12550
12495
Main target 12100
Im expecting a low to get hit by sometime Tuesday, pathway is shown on the chart
NQ - Nasdaq below CL, going southThe white pitchfork is a "pullback fork".
This huge monster measures the whole swing, from April 2020 to the highest point ever reached in the NQ.
What is the benefit of such a pitchfork?
1. We see where the center is.
Above the center, the market is very strong. It's likely that the market continues in the projected direction.
Below the CL (Center Line) it's very likely that price will not jump above it again. So the only ways are sideways or down.
2. Knowing the rules how to trade the pitchfork, we have a nice test at the centerline. Usually we see another test, or even multiples, before the market is heading towards the L-MLH, the Lower-Medianline Parallel and beyond.
So, if price falls below the L-MLH, a test/retest is expected and the next target is at least the first WL (Warning LIne...it "warns" that price could turn from there since it's overextended by 2 magnitudes).
Let's be curious and put our observation Hat on.
#learntoearn
NQ1! - Nasdaq Pitchfork Short ExampleJust study the chart and you see the process.
The scene of the crime as my mentor always said ;-) is where price broke down hard the first time. Often than not, price has the tendency to come back to these levels. As it did today.
Price ran into the "Scene Of The Crime" or the "KillZone" and got hit on the head several times. Here you had 3 chances to short the market, with a decent stop, giving you a perfect RiskReward trade.
The target was obvious. The centerline.
Price got there to the tick and turned on a dime.
That was a perfect pitchfork trade.
As for a filter I like to use the RSI or even the MAC and/or the AO. What ever makes me feel good for a trade, I'l take it if I have proof that the tool helps me in my trading.
So, go and study the pitchforks, but don't think its easy. It's simple, that's true, but it's never been easy, at least for me.
The most important part in this trade for me was the Stop. The phrase "Never loose money" is kinda dumb. But it carries a truth. By only risking very less, you are never exposed to loos your "soldiers" in a fight/trade.
#cudosToShaneBlankenshipFromLanguageOfMarkets
NQ still SHORTWell, NQ will suffer for a while, and I posted an analysis mentioning so.
it's still gonna be short for a while, price is not showing any signs of a push by the buyers, in fact it's the other way around.
price is being forced to drop and trust me it will
if you didn't check my previous mentioning of NQ drop, I'll put the idea down.
Nasdaq following the planAs we can see, NQ was following the "plan" exceptionally nice.
To me that's a proof how the concept of Allen Andrews works. But there is much more in it than just painting nice Pitchforks.
The REAL benefit a trader can gain is the study of swings. When I started study the swings, it was a crazy new world for me.
So if you are interested real and profound technical analysis, I suggest you search on YT for my mentor which is Shane Blankenship from "Language Of Markets". He's the real wizzard who explain the charts like no one else on this earth.
Compared to Shane I'm just a talent at best. :-)
So, how will the Nasdaq proceed from here on now?
There are the following scenarios:
1) NQ will pull back to the white Centerline, zoom through it and continues to the upsdie.
2) NQ will continue it's path to the downside to the Lower Medianline Parallel.
I leave it up to you how to trade this but the best you can do is using good structure for a stop and use small stops, to make huge Risk-Rewards, like the trade from today.
Stay save.
NQ 4HR - Double Bearish Harmonic PatternsFirst of all - this is my first published idea, so I don't want anyone to trade based of this idea blindly. Second - I know history does not always repeat itself.
Doing some early prep for next week I noticed these two harmonic patterns formed on the 4HR NQ chart. I normally do not trade based off of harmonic patterns, (don't know if these are gartley, butterfly, etc) but they looked so similar in time and precise formation that I had to post. Hoping someone with more experience - especially with harmonic patterns can comment and advise of their thoughts or ideas for confirmation.....thanks!
--IF the corrective wave plays out similar to first, this has potential for 800+ point drop--
FAANG Index Short interest Increases!We saw that tech had led the majority of this rally, retail or not. the tech rally was the center of attention. Which is focused around the largest tech companies we all know.
Facebook, Amazon, Netflix, Google, and Apple. Together they have a Market Cap of over $5.6Trillion. Making up over 35% of the Nasdaq Index. If we include the honorary FAANG member, Microsoft we drastically start to inflate the previous numbers and the impact of a few big tech companies on the market.
The FAANG and MSFT make up more than 25% of the S&P 500 as well. So this handful of stocks has the potential to move entire markets. Which it has done.
The Nasdaq hit an all-time high day after day, so did the S&P 500 at some point this summer thanks to the FAANG index and the tech stocks leading the way. This most recent sell-off has taken off over 5% in the biggest US indices.
We saw the FAANG collectively drop about 15-16% from all-time highs. however, that sell-off was signaled by a few things and has signaled that there is more to come. Here is why keeping mind both technical and fundamental reasons.
First off, we pressed into an all-time high after an all-time high in a summer market where the volume is thin and the trading is thin. Meaning the highs we not on strong volume. In this case, we also had the largest market cap company ever split, Apple did a 4:1 split. Historically meaning a lot of profit-taking after the post-split pump.
This was also the case for Tesla, which is included in the Nasdaq but still waiting for the S&P 500 invitation.
The next case for the downside was not only the overvalued market but also the "September theory downside" Which is something that has plagued markets for 40 years. On average over the past 40-years, September has ended red. Why? Because 1, the fund managers, institutional investors, or just big money coming back to the desk after labor day and doing some market movement or rebalancing. Which is just in time for the end of the third quarter. Rebalancing their funds after seeing tech gain 50% on average this year means drastic profit-taking. Which is why there is more downside to come. We just needed to see a slight rebound before seeing the continued downside. It's the equivalent of buying highs. You don't want to sell lows even if you are profit-taking.
Another interesting aspect is the strength that Biden gets throughout the election campaign process. The more ground Biden seemingly gains the weaker the market looks. Which could be a future indicator of what we could see throughout the election.
There are 3 scenarios we want to outline for the future of the FAANG and the overall market indices. There is a more perceived downside throughout September. This is due to continued rebalancing and profit-taking anticipated to take place in the market. Taking advantage of the weak volume to the upside.
Scenario 1:The first being the FAANG drops down to tag the Nasdaq's perceived downside. In order for that to happen though, We'd need to see the rest of the 75% of the Nasdaq hold out without falling or even slightly climb. This doesn't seem that probable, the big stocks in the FAANG pave the way for how the rest of the Nasdaq stocks will most likely react. This would mean the Nasdaq stays relatively flat while the FAANG falls another 11%. This is an unlikely scenario because if the FAANG drops, Nasdaq will probably get killed.
Scenario 2: This is the least likely scenario out fo the 3. Involving the Nasdaq climbing while the FAANG drops about 5% to meet somewhere in the middle of the current divergence. That is highly unlikely because if the FAANG drops, the NQ is dropping almost for sure.
Scenario 3: The last scenario involves downside in the FAANG due to continued profit-taking and rebalancing out of the major tech stocks. Which would push the Nasdaq down to the -15% mark, as it is already through the -10% mark from highs which marks a correction? In this scenario, the FAANG will continue to drop and some of the big tech stocks would be more than 20% off highs into a more "natural" valuation. This scenario is the most likely out of them all.
To conclude it does seem like there is more downside as a lot of the FAANG and tech stocks are overbought and a lot of investors are profit-taking after such incredible gains. We could see the tech stocks pull back into their summer consolidation prices which would be a great area to look for the reversal.
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