The NASDAQ 100 ETF, $QQQ, started to lead the markets higher Monday. It ran up to a penny above the prior intraday high before selling off late in the day. This of course will bring out all sorts of conclusions from both the bullish and bearish side of the market.
The bears will be talking of a double top. That the close was at a lower high. That volume was lower Monday. The bulls will point out that momentum is just starting to build. That it stalled because the Bollinger Bands® got in the way. That is is still above the 20 and 50 day SMA’s which are trending higher. So who is right?
I do not know. I do know a few things though. First is that the QQQ has been trending higher since April for short term traders or since he start of 2016 for longer term traders. It will take a move to a lower low to change that. In the extreme short term that means below the September 7 low. For longer term players it is likely below the February lows. Until that time the primary trend is up.
Also do not lose track of the fact that trends are called trends and not lines. A line goes in one direction all the time. A trend moves generally in one direction but with back and forth motion. Not every day will be an up day in an uptrend. And many days will be down days in an uptrend. Let the bulk of the evidence of a trend change reveal itself before acting on it. And stick to the evidence, not predicting what might happen.