Tuesday, April 29, 2014

Can QQQ/Russell 2000 rally back above 50 day moving average? Can Dow Jones (DJIA) break to new highs?



QQQ rebounded after testing the key support level (83.68/83.37/83.28 area), near the 200 day moving average. Volume has been supportive as up volumes were higher than down volumes. MACD shows positive momentum below the zero line. However, the rebound seems to be corrective so far. A break above the 88.21 level and the 50 day MA at 88.40 is needed to defer and signal further strength towards 89.68 and higher.
A breakdown below the 4-month support line (yellow) would complete a head-and-shoulders top.
$RUT daily chart looks similar to QQQ.
DIA (DJIA ETF) looks the best out of the three. It should break above the 166.51/166.06 record high area quickly and decisively to negate a double top/triple top scenario.

If DJIA breaks out to new highs, then nasdaq and $RUT would follow, negating the bearish topping scenario. 

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