Mission Accomplished! Now What?
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QQQ’s “catch-up” move achieved our projected targets according to gamma (GEX), gapping up and stretching beyond the upper Keltner channel in today’s session. SPX is rapidly approaching the big 6100 area we’ve been watching, and we see GEX growing at 6200-6300. The bulls just don’t give up! We posted a YouTube video tonight where we go over SPX more in depth and we also discuss AMZN, BTC, GILD, QQQ, and more, but the newsletter today will specifically focus on QQQ and some additional possible plays not covered on YouTube. So check out the recording knowing we don’t cover the exact same topics or stocks.
Looking at the chart above, there’s no denying that QQQ has a very bullish Keltner configuration, with the upward channel sloping even more steeply higher as of late. This is characteristic of a strong uptrend and any desire to short such a move should at least be based on some sort of initial signal that justifies the risk/reward. It’s sometimes unwise to catch falling knives, and I also wouldn’t try to jump in front of Elon’s rockets, either.
Alright, so everyone and their dog (or gerbil or capybara) can see that QQQ is bullish. We also see GEX growing as high as 530 and 540. But is it really THAT easy? Maybe so, as funny as that is to say. But we must note that QQQ is now at the lower edge of the G1 Dealer Cluster zone, an area that GEX identifies as a possible reversal zone or consolidation zone for QQQ. The box does stretch up to that 530 level, but that doesn’t mean that QQQ will necessarily make it that far at this particular time. The fact that price is already above the upper daily Keltner, and you can look back at what happened the last few times we reached the upper Keltner, might mean we need another breather before considering higher targets. December is an entire month, not just tomorrow, so ending the year at new highs can still happen even with a decline thrown into the middle.
Lastly, the light blue bars to the right of the purple net GEX bars indicate daily option volume. While very speculative as to what it means, I see very little option volume at higher prices and a lot of option volume from 510 (the zero GEX line) up to 520.
QQQ Levels: www,geekoffinance.com
QQQ GEX popped right back up to the 1B mark, an area that we consider to be bullish, yet also an area that (this year, at least) has more often marked short-term tops for QQQ in particular (SPX and SPY are a different matter). We’ll keep an eye on this as a possible contrarian signal.
QQQ Historical GEX: www.geeksoffinance.com
With markets just a wee bit euphoric, let’s look at a couple of black sheep in tech-related land that may be worth a closer look, starting with DELL. Since August, we see a fairly solid uptrend, though it almost looks a little “bear flaggy,” so I wouldn’t call it my favorite chart pattern that ever existed. But we can see that the gap down in late November brought the stock to the lower Keltner channel and price has been consolidating sideways. Indecisive, but once again, the Keltner’s seem to be a fairly good boundary that has been respected (with exceptions).
What I like about DELL (other than the pullback for possible entry) is that we have positive overall GEX and we see a large cluster at 130, as well as accompanying volume at that strike. With the middle Keltner at 133.50, perhaps an upside target of 130-133 isn’t an unreasonable potential trade. We’ll also want to see what happens to GEX as we move higher.
DELL GEX Levels: www.geeksoffinance.com
Another ticker to watch is one I jokingly call the semi-semiconductor, because INTC moves to a different beat than many other semi stocks. It’s interesting that the chart looks somewhat similar to DELL. INTC has shown more intense recent selling, but we’re approaching the lower Keltner very quickly at 21.32.
This particular 22 area matches a G2 Dealer Cluster zone where we might see INTC reverse back up. GEX at 21 also looks meaningful, so any further incursion to the downside may also represent a buy-the-dip opportunity. We see volume today at 22, and we have a big GEX cluster at 25, which represents the G1 Dealer Cluster, so maybe INTC can give us a year-end whipsaw just to shake things up. GEX is barely positive, but it’s still positive, so we don’t see participants reflecting as bearish of a stance with GEX positioning as we see with the price itself lately.
INTC GEX Levels: www.geeksoffinance.com
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