5/27/2018 Weekly Charts of the Indexes

QQQ Weekly 5_27_2018.PNG

Above is the weekly chart of QQQ.  Notice that QQQ has run into overhead resistance at about 170.  The daily chart has formed a bull flag, which hints that a break above 170 means we run to 178-180 in a couple weeks.  As of 8 PM Mountain Time (10 PM Eastern Time), futures are up quite a bit, so I’m expecting a strong up-day on Tuesday.  

The concerning thing on this weekly chart is the negative RSI divergence.  Notice how we’ve made a higher high in March, but the RSI did not make a new high.  Currently, the RSI is only at about 60, and we are approaching a new high again.  As a bull, I wouldn’t be concerned unless QQQ breaks below 155.  If we break below that, I’ll be mostly looking to short sell 🙂

 

SPY 5_27_2018 Weekly.PNG

The SPY is a bit weaker than the QQQ, but is still holding up nicely.  Bulls want to see a breakout above 280, and bears want to see a weekly close below 260.  My bet is that if SPY drops to 260, we will have a lot of panic selling as I think that support level won’t hold.

 

DIA analysis 5_27_2018 Weekly.PNG

The DIA looks very similar to the SPY.  I think if DIA breaks and closes below 235, we will see a lot of panic selling.  Perhaps we could see a drop to something like 220.  Bulls want to see a weekly close above 253.  I think there’s a better chance we move up and break above 253.  

See you Tuesday after the market closes! 

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