Trends are Bullish, but Extended

The QQQQ continues to look tired here. If it can make it back over $42.50 it is going to put a real hurt on a heavy institutional short position that is already hurting badly. However, if gets sold back down to $41.50 it will signal the beginning of a larger correction. The S&P and Dow both look much stronger, and while they are oversold and at risk for a pullback to their trend lines, dips remain buying opportunities. The end of the month should once again see a good rally take place. Since options expiration was last Friday, however, we could be in for some weakness as we start out the week this week. It is best not to get too aggressive until prices come back to better support levels.