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Nasdaq heading lower

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After breaking below the 39.50 level on the Thursday, the Nasdaq- 100 (QQQ) tried to rally back above 40 Friday. The rally failed, and today QQQ continues to sell off.

Nasdaq-100 60-minute Chart

It was textbook technical play. Prices broke support, retraced and took out some traders' stops and then moved lower. If you missed the initial move, the pullback offered another chance to get short. Since I missed both moves, I'm looking to see if a similar pattern can set up by prices rallying back and consolidating at the previous low at 38 and then moving lower. I'm not going to chase the QQQs lower, but if the market gives me a third chance maybe I'll be able to get on board.

Jeffrey Canavan
Assistant Anaylst
www.PremierMarkets.com

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