Technical Strategy Video:

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The video in this report is only accessible to members

Key Takeaways

  • Trends look to be joining momentum back lower following Thursday’s abrupt reversal.  QQQ closed at the lowest levels since October, and cycles show possibility of weakness into late January before much relief. 
  • Biotech looks to be nearing key make-or-break levels after severe weakness in recent weeks.  Key stocks to favor in this group discussed
  • Pharmaceuticals remain a better way to play Healthcare near-term, and this group has broken out relatively speaking vs Biotech coinciding with recent market volatility.   

QQQ (Invesco’s QQQ Trust) has now closed at the lowest levels since late October, and underperformed DJIA and S&P dramatically on Thursday.  Increasingly, this pattern looks vulnerable to pulling back to break early week lows.  This daily chart shows QQQ having morphed into a large consolidation pattern since November which has been largely choppy and uninspiring.  Yet, the wave structure on the recent decline from late December was clearly bearish from a structural perspective and had negative effects on momentum.  Furthermore, Equal-weighted Technology violated a one-year uptrend vs SPX this past week.  Bottom line,   weakness down to 355 is ...

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