Chart Wars: QQQ

I covered the S&P 500 Index earlier. That post has more commentary. This one is simpler. Coming into last week, I expected a possible 6 to 7 percent rally back up to resistance. I made quite a bit on Monday, my largest one-day gain ever in terms of dollars, by catching most of the reversal from low to high. While the S&P 500 chart is a bit messy, the Nasdaq and QQQ are clean. There's a clear window for a 7-percent rally to resistance or a 5-percent drop through the lows of last week. Similar to the S&P 500 Index, a rally up to resistance would create a large head-and-shoulders pattern. If down is the direction, the expected move from Friday's close is a 20-percent decline. The 5 percent down to the low, and then approximately another 16 percent. If the Nasdaq rallied up to resistance, it would be another 20 percent down. In conclusion, the total decline from the high should be in the 25 percent to 30 percent area, around $300 on QQQ, and the only debate for me is how much the bulls can push it up before then.