Zeev's Turnips Patch-No Politics (ZEEV)

[Mr Nasdaq]

QQQQ - From tonight's 'Support & Resistance Report'

The 'Support & Resistance Report' identified an area of 'Gathering Support' between $38.35 and $38.21 going into Thursday's trade, and so it was found to be.

After opening at $38.44, the QQQQ dropped in early trade to test its area of "Gathering Support". After printing a low of $38.24, Support was found. A subsequent rally lifted the QQQQ 45 cents to $38.69 shortly after 10:00am.

Another drop in the afternoon found the QQQQ testing its area of "Gathering Support" again. After printing a low of $38.24 again, Support was found again. A subsequent rally lifted the QQQQ 49 cents to its high of day ($38.73).

See the 5-Minute Chart for a visualization of today's price action:
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID735617

Thursday's rally resulted in a phenomenon on the Daily Chart known as a "back-side-bounce". It's called a "back-side-bounce" because the price rose high enough to kiss the "back side" of the rising trend line that was violated to the downside on Wednesday.

Do not be fooled into a bullish stance because of Thursday's rally. Having been violated on Wednesday, there is now Resistance at that rising trend line. After Resistance has been thoroughly tested, the overall down trend will resume.

For Friday, be prepared for another "back-side-bounce" against the rising trend line. Keep in mind, however, that it is not the beginning of the next leg up. Rather, it is the precursor to the next downdraft.

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).

Visit the "Support & Resistance Report" web site:

http://home.comcast.net/~mewinfree/SupportAndResistanceReport.html