New game plan...
Okay, the QQQQ fibo projection target is $55.10. That's the 161.8% level. But $50 is a big level here, too. So, anywhere here.
Now, 5/23/08 high is $50.47. This rally's high so far was $50.57. So, a double top? The 07 high for the Q's was $55.07 when the DOW and SPX were making all time new highs.
The point? If you take the level we're at now, $50.50 let's call it, use it as a neckline, then take the 3/21/08 $41.05 swing low on the initial drop before the big drops of '08 as the left shoulder, we can assume potentially an inverted head and shoulders setting up on the weekly chart. It's pretty clear. So, we should then expect a big pullback to begin right here any day to take us back down to that $42ish level between now and Oct? If you time it the same and the same angle of degree, we should be around Sep 3rd through the 17th to get that low. I'm not calling those dates as 'the' dates, but just watch for it.
Now, after that, it gets interesting. If this is a setup for a new major leg higher, what 'should' happen is that the market finds a low around the low $40s on the Q's, then begins a new setup leg up for an inverted H&S breakout to the upside. A break then of $50.50 next year will most likely mean you'll see potentially over $75 on the Q's within the next two years. That's right!
But the initial thrust out of the $50.50 neckline will be explosive. Explosive enough to setup quadruple returns on options right out of the gate.
But, since we'll be aware of this entire thing starting now, we'll start going long calls this fall if the market begins to trade down to our $42 level on the Q's. $42 or so could put TZA around $10 to $11.
S2
