NDAQ shows perfect Wyckoff Distribution: Begin Markdown
Diupdate
NDAQ is of course highly correlated with NDX, QQQ, and relate tickers so if NDAQ looks bullish it is a sign that TQQQ and SQQQ will move predictably. If NDAQ is bearish that will have likewise opposite effect.
NDAQ came screaming out of the March low to set an advance into a buying climax. The initial give back of that buying climax sets up the Automatic Reaction and that helps define our zone of support, also called the ice due to how dangerous it can be when it breaks.
The support on the ice here was confirmed with a bounce of the 20 day moving average which lead to a lower high. That in itself is nothing too serious but subsequent to that price actoin slipped the 20 day and hit the ice again as a Sign of Weakness.
After the sign of weakness there was a Upward Thrust which didn't have the buying volume to continue. In other words, bulls where exhausted and could not continue the uptrend. In another sense, there was no one else to pump the bulls bags as buyers were unwilling or unable to continue the trend.
I like to use the On Balance Volume EMAs to evaluate this uptrend, peak to peak. I have tried using it on larger timeframes and it doesn't work for me, it isn't responsive enough on the monthly timeframes and my entries are too late. But this is a great resolution.
We see this uptrend was not supported with enough volume and the indicator shows a lot of classic bearish divergence which predicts a reversal. Also, OBV break of the 100 EMA is extraordinarily bearish circumstance and should not be taken lightly. Also on that chart is my VSTOP system I continue to tinker with. The MTF VSTOP flipping bearish is also... very bearish.
After the Upward Thrust the ice breaks. This is bad because if price action doesn't recover it basically drowns and sinks to the bottom. The ice has flipped from support to resistance and when price actin failed before even hitting the 20 day moving average we have a very bearish set of circumstances.
The bottom might be hard to find. DJI has set a lower high and SPX is double topping, both with falling volume so this isn't a bullish set of circumstances. (Technically a double top has peaks within 5% but I think SPX double top with a 5.7% difference is close enought to round down).
I am going to let this run for quite a while. I entered my SQQQ position a couple days ago and feel confident that I can let this run until I see some bullish divergence on the NQ1! or SPXU MACD on the 12h or I see NDX out of the bottom of the weekly or monthly bollinger band. My linked post below is one of my most painful post. I completely nailed the bottom reversal and then buggered up the trade by not letting my winners run and shorting too soon. That is one reason why I have incorporated the VSTOP and MTF VSTOP into my system to help steady my hands to the upside when the macro situation is so bearish.
NDAQ came screaming out of the March low to set an advance into a buying climax. The initial give back of that buying climax sets up the Automatic Reaction and that helps define our zone of support, also called the ice due to how dangerous it can be when it breaks.
The support on the ice here was confirmed with a bounce of the 20 day moving average which lead to a lower high. That in itself is nothing too serious but subsequent to that price actoin slipped the 20 day and hit the ice again as a Sign of Weakness.
After the sign of weakness there was a Upward Thrust which didn't have the buying volume to continue. In other words, bulls where exhausted and could not continue the uptrend. In another sense, there was no one else to pump the bulls bags as buyers were unwilling or unable to continue the trend.
I like to use the On Balance Volume EMAs to evaluate this uptrend, peak to peak. I have tried using it on larger timeframes and it doesn't work for me, it isn't responsive enough on the monthly timeframes and my entries are too late. But this is a great resolution.
We see this uptrend was not supported with enough volume and the indicator shows a lot of classic bearish divergence which predicts a reversal. Also, OBV break of the 100 EMA is extraordinarily bearish circumstance and should not be taken lightly. Also on that chart is my VSTOP system I continue to tinker with. The MTF VSTOP flipping bearish is also... very bearish.
After the Upward Thrust the ice breaks. This is bad because if price action doesn't recover it basically drowns and sinks to the bottom. The ice has flipped from support to resistance and when price actin failed before even hitting the 20 day moving average we have a very bearish set of circumstances.
The bottom might be hard to find. DJI has set a lower high and SPX is double topping, both with falling volume so this isn't a bullish set of circumstances. (Technically a double top has peaks within 5% but I think SPX double top with a 5.7% difference is close enought to round down).
I am going to let this run for quite a while. I entered my SQQQ position a couple days ago and feel confident that I can let this run until I see some bullish divergence on the NQ1! or SPXU MACD on the 12h or I see NDX out of the bottom of the weekly or monthly bollinger band. My linked post below is one of my most painful post. I completely nailed the bottom reversal and then buggered up the trade by not letting my winners run and shorting too soon. That is one reason why I have incorporated the VSTOP and MTF VSTOP into my system to help steady my hands to the upside when the macro situation is so bearish.
Catatan
Things have progressed bearishly and so I expect, given the MACD situation and todays price action we get another retest of the Ice/20 day moving average like we did in the last dump. Therefor I suspect there will be another short entry around the 20 day.We are at the weekly VSTOP so some support is to be expected. I also expect some action at the MTF VSTOP.
Catatan
NDAQ has once again returned to the ice and has so far, yet to break through. We have another major sign of weakness and we should expect the markdown to go full throttle now.In the related Ideas there is my new post on SPY, QQQ, and DJI all showing double tops. If you are following this post I recommend you read that one as well.
Catatan
Provisionall it seems my original post was a micro fractal of a larger Wykoff formation. If so, I would expect to see a breaking and testing of the ice in the top chart and then a coninued mardown.
For the weekly marcro chart the indicators back up the bearish scenario. The VSTOP and MTF VSTOP show the zone of support and the fact that price action has slipped the 20SMA is likewise bearish. The OBV with EMAs show volume is getting constricted which suggest a large move is incoming.
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