A Relative Strength Clue for QQQ (Free)

The market continues to be mixed and bullish. Techs and high-flying ETFs led the correction from the February highs to the March lows, but we are now seeing signs of short-term leadership in large-cap techs, namely QQQ and XLK. These two held well above their early March lows and broke out of flag patterns. Other tech-related ETFs and high-flyers are

Today’s commentary will focus on three ARK ETFs. Overall, there are eight ARK ETFs that capture cutting-edge technology or innovation in several areas. Six of the eight have been trading for more than three years. The ARK Fintech Innovation ETF (ARKF) started trading in February 2019 and the ARK Space Exploration ETF

Today’s video starts with the corrections in QQQ and IWM, and the resilience in SPY. Techs started the corrective process and small-caps joined this week, but large-caps in the S&P 500 remain immune. Nevertheless, QQQ has a flag breakout working and shows some short-term relative strength. Stocks could find another wind from two bullish seasonal

The market regime remains bullish, but we are seeing corrective price action over the last few months. The Nasdaq 100 ETF started it all off with a sharp decline from mid February to early March. IWM got involved this week with its biggest fourth decline greater than 9% since March 2020. SPY has largely avoided the correction fray and remains the strongest of the big three.

The market remains defensive overall. There were flag breakouts in a number of tech and growth ETFs last week and these breakouts are failing this week. Once again, the tech and growth ETFs are leading the way lower. Even though these ETFs are down sharply over the last six weeks, the declines still look like corrections within bigger uptrends. The mid March highs provide the first resistance levels to watch going forward.

This commentary was originally posted on Wednesday, March 17th, in PDF format. Today I am replacing the PDF with chart images on a web page. Some of the text has been adjusted, but the commentary/charts are largely the same as on Wednesday. These charts cover the massive moves in tech-growth ETFs over the past year, the interest rate debate, Chinese ETFs firming in reversal zones and the Brazil ETFs surging off the 200-day.

QQQ and the tech-related ETFs triggered flag breakouts last week and these breakouts were challenged with a pullback this week. Some breakouts failed (IGV) and some are at their moment of truth (IPAY). Today’s video focuses on trailing stops and breakout zones for several of these.

We finally got a bit of a shake up this week as oil fell sharply on Thursday. We also saw big declines in the Nasdaq 100 ETF and Russell 2000 ETF. It was basically triple shock Thursday with small-caps, large-techs and oil getting hit hard. Tech and growth related ETFs were also hit hard as money moved out of the high-beta end of the market.

There are lots of flag breakouts here in March. Some triggered in early March, some last week, some this week and some are still working, which means price is still near the breakout zone. There were short flag/pennants that lasted a week or so (KRE), shallow flags (IJR), falling flags that lasted three weeks (SPY) and sharper falling flags that lasted four weeks (QQQ, IBB).

Stocks perked up this week and we saw flag breakouts in several ETFs. Small-caps led the charge with IWM hitting a new high. QQQ even rebounded with a breakout, but is still lagging year-to-date. Strategically, the Composite Breadth Model remains in bull market mode. Tactically, the breakouts are holding and we will show how to monitor SPY and QQQ going forward. It was also a big week for Utilities and Consumer Staples,

SPY and IWM recorded new highs this week and continue to lead the broader market. Even though QQQ and XLK are underperforming this year, the old school sectors held strong and propped up SPY. After short pullbacks into early March, stocks caught a bid this week and we are seeing flag breakouts in

There are a lot of pullbacks to deal with today. Some pullbacks are shallow, some are deep and some are in between. Often, the bigger the advance, the deeper the pullback or retracement. Despite some big percentage declines, most of the pullbacks are normal in retracement terms (33 to

Despite an increase in intraday volatility the last few weeks, the recent pullback is actually quite tame, especially for the Russell 2000 ETF and S&P 500 SPDR. QQQ bore the brunt of selling pressure and the Nasdaq 100 Breadth Thrust Model turned bearish. I am not concerned with this signal because the S&P 1500 Thrust Model remains bullish. Today’s video will show backtest results

The long-term evidence remains bullish, but the major index ETFs have moved into corrective mode of varying degrees. The S&P 500 SPDR and Russell 2000 ETF are in the midst of shallow pullbacks, while the Nasdaq 100 ETF is leading the way lower with a sharp pullback. Downside participation was so strong in the Nasdaq 100 that the Breadth Thrust

Even though ETFs related to small-caps, mid-caps, industrials, finance and energy are performing well and not part of the correction process, a big portion of the core ETF list are in some sort of pullback or correction over the last few weeks. 48 of the 119 ETFs in the core list are down over the last 22 trading days (since January 29th) and 22 are down more than 5%.