The chart above is the QQQQ. As you can see it is fast approaching the resistance area where it has already suffered 2 very harsh corrections. Yesterday’s volume as it moved up to fill the gap was just over ½ normal volume levels.
We don’t know about everyone else, but this does not inspire us to buy shares at these prices.
To make matters worse, the put:call ratio flipped back to more bulls than bears. The market isn’t overly bullish here, but the fact that the crowd is now starting to believe in this rally, which they have up until now doubted, also does not inspire confidence from us.
We wouldn’t short yet, but if the market continues higher today on light volume, we will certainly want to put on some short hedge positions by tomorrow.
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