Like a few other bellwethers we’ve been watching closely, QQQ has been loitering near a potentially important Hidden Pivot target for weeks without being able to get past it. The target lies at 312.29, a mere 31 cents above the record high recorded on December 18. Although the shallow retracement so far suggests buyers are eager for more, there is no telling how much supply may be out there at these levels, especially if the headlines should take a menacing turn. We own some Feb 19 240/250/260 put butterflies in any event, since bulls are long overdue for a comeuppance, but also because the 312.29 target looks so compelling. A financial collapse — The Big One that we all know is coming — is never going to be an odds on bet for timers, but our odds are certainly improved when the charts are as closely aligned for a multi-index top as they are now. _______ UPDATE (Dec 28, 5:54 p.m. EST): The Cubes topped our benchmark by half an angstrom, earning a begrudging ‘So what?’. ______ UPDATE (Dec 29, 7:50 p.m.): And now they’ve closed above it for two straight days, although not by much. Let’s give bears another day to show us what they are made of. _______ UPDATE (Dec 30, 7:30 p.m.): Bulls, too, are acting pretty timid, but if some stray piece of ‘good’ news should buck them up, look for the rally to continue to 321.43, or 329.40 if any higher. Both of these Hidden Pivots are shortable, tightly stopped. Their provenance is shown in this chart.
QQQ – Nasdaq ETF (Last:312.96)