Zeev's Turnips Patch-No Politics (ZEEV)

[Mr Nasdaq]

Comments from Thursday night's "Support & Resistance Report":

The QQQQ delivered an "inside" day on Thursday. We've seen "inside" days before. It's when the high of the day does not move above the previous day's high and the low of the day does not move below the previous day's low.

An "Inside" day ordinarily indicates indecision. This one, however, leaned toward a more positive interpretation because it closed near its high, presumably in anticipation of a good earnings report from DELL.

DELL, however, ended down over $3.00 in after hours trade. It took the QQQQ down with it.

The Fibonacci 50% Retrace of the Summer Rally's losses going into Thursday's trade stood at $39.55. The QQQQ rose early in the day to test Resistance at that level. After printing a high of $39.54, Resistance was found (See the 5-Minute Chart):
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID735617

The QQQQ subsequently pulled back to find Support at the previous day's closing price ($39.11). Support was found and the QQQQ recovered to close at $39.43.

It's last trade in the after-hours market, however, was $39.22, down 21 cents from its closing price, compliments of DELL's earnings report.

Resistance at the Fibonacci 50% Retrace of the Summer Rally's losses remains unchanged at $39.55 going into Friday's trade.

Failed Support at $39.21, opens the door to a minimum Fibonacci 38% Retrace of the Summer Rally ($38.77) and perhaps a 50% Retrace ($38.35). See the Daily Chart for the Summer Rally's Fibonacci Lines:
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID735617

The 50% Retrace Line ($38.35) would be a good place for the QQQQ to find Support and a bounce. That's because the "50-Day Moving Average" ($38.37) happens to be in the same vicinity. The combination of these 2 aspects of Support compose an area of fortified Support.

The best trading strategy in a Down Trend is to sell when prices rally to areas of Resistance, especially if prices rally to areas of "Gathering Resistance" (highlighted in purple on the "Support & Resistance Report" Spreadsheet).