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Foreign Exchange Analytics
www.investing.com/analysis/technical/foreign-exchange-analytics-12016
Foreign Exchange Analytics
By | Oct 23, 2008 08:00PM ET In the Sept 25th email on the QQQQ (Nasdaq 100 etf), affirmed the long held bearish view (still short from the Sept 5th resell at $43.70). The market has continued sharply lower since, today reaching a low at $28.09. Still view the market as within wave 3 in the fall from the June high at $50.61, with risk rising for a significant $7-8 bounce (over 25%). Note too that today, the market spiked below the base of a potential falling wedge that has been forming over the last few weeks (potential bullish “false break). These are also generally seen as bottoming patterns that resolve sharply higher, and increases the likelihood of gains toward the ceiling of the wedge (currently at $32.25) and even above (see scenario in red on daily chart below). Given this rising risk to the short position, would take the large profits here (currently at $29.70, for a $14/32% profit since early Sept). Note too if shorter term, would also buy on a clear break above the ceiling of the falling wedge (both further upside on a break may be a short-lived spike).
Longer term, the bearish bias for nearly the last year remains in place and there are still no signs that a major bottom is in place. Even the nearer term bullish scenario above would viewed as the “best case”, as such a move higher would be seen as a correction (wave 4 in the fall from the June high at $50.61) and with eventual new lows after (within wave 5, see “ideal” scenario in red on weekly chart/2nd chart below). Note too that this scenario fits the cycle view on a potentially major bottom in the mid Dec timeframe. For the longer term, would maintain the long held bearish bias.
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Foreign Exchange Analytics
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