Paint Your Bias:

In life, there are usually two sides to a story. The stock market is no different and we are coming to an interesting part of the year. Obviously, it has been a good 2023 for technology, but we do know the vast majority of gains tend to come in November and then stall in December (notice over the last 5 years November has been the strongest month on average rising 5 straight and then November has a flattish return). That appears to be what is occurring presently. Looking at the WEEKLY chart below of the QQQ one could make an argument for their position. Bears could certainly claim that the last couple of weeks have recorded spinning top candles which could indicate some fatigue following the powerful recent run. Also, the fact that the WEEKLY break above the cup with handle is stalling as we know the best breakouts tend to work out right away, and if they do not it is often a red flag. Bulls, which I am in the camp of, would say we are simply consolidating the outlier move and William O’Neill followers would recognize the possibility of a 3-week tight pattern forming depending on Fridays CLOSE. The last 2 weeks CLOSED with a 389 handle and if that happens again would complete the potentially robust pattern for a vibrant move higher. Stay tuned. This is a time to be patient with long ideas.

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