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June 8th, 2010: Update 4 – Intra-Day Mid-Day

Posted by pugsma on June 8, 2010

1:00pm EST:  I was looking at the QQQQ’s today and I noticed it’s relative strength when compared to the SP-500, DOW-30, and Russel-2000.  What jumped out at me is that this entire move down since the April high looks like a contracting triangle.  And if you go back to the November 2008 low on the QQQQ’s, then you can see that the QQQQ’s are still well within a very nice parallel bull market channel.  This recent drop form the April high to the May low could just part of a wave [4] a-b-d-d-e triangle.  This a-b-c-d-e triangle would alternate with the wave [2] a-b-c Zig-Zag back in the early part of 2009.  I get a wave [5] triangle target of 45+9 = 54 for the QQQQ. This should be acheived in late summer 2010.   We need to watch for a break above 46 to confirm that the e-leg of the triangle is complete here around 44.

This new QQQQ chart would argue that primary wave 1 (P1) of the new bull market is not over yet and we have a long way to run.   This whole move down of the April high would be a great big bear trap and the next move higher will squeeze the bears yet again.  Food for thought as we search for a tradeable bottom in the next few days.

QQQQ Daily Chart (12:43am):

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