We are stuck in a range ahead of the Feds. QQQQ (see daily chart)could not hold the May lows at 38.23 on Friday and it could set up a move down to the June gap 37.63 / 37.84. I don't think we will take out the yearly lows ahead of the Feds. In fact, I would be a strong buyer of any drop to the 37.70 area.
Futures traders should focus on NQ ( see 60 mn chart) and its gap at 1545.50/1556.75. We usually get a test of either weekly S1 or weekly R1 early on, and since weekly S1 is at 1551.25, it puts us right in that gap. I would buy any drop that stays above 1545.50, but start hitting it at 1550 or so. Weekly R1 is 1595 and a possible short, but only if the gap has not been closed or weekly S1 tested. Bullish scenario has 61.8% of rally hold at 1560, also a double bottom, in which case buy it ahead of the Feds and possibly get a cushion. Keep in mind we have end of quarter window dressing, and one might want to fish for bargains that are being unjustly punished. Add the Feds, and you have a recipe for some pretty serious volatility.
This entry was posted
on Sunday, June 25, 2006 at 3:42 PM.
