NASDAQ-100 ETF (QQQQ) bulls had Monday's gap-up open stuffed in their face for a $0.42 decline of 1.3% by the $30.77 close, recording a fourth quarter 'bearish reversal'.
Q: Over the course of its fourth quarter history, how does QQQQ perform after a gap-up open culminates in a 'bearish reversal' by day's end?
A: According to the nine previous occurrences of this event, EventEdge indicates that QQQQ has shown a strong bullish edge that peaks five trading days after the event. Thus, the projected date for the peak of the bullish edge relative to the current event date (Monday, Nov. 10, 2008) is Monday, Nov. 17, 2008. QQQQ rallies in 100% of the cases (9 of 9) by an average of 3.8% relative to the close on the event date. The overall return of the nine cases is 3.8%, which, based on the close of QQQQ on the event date ($30.77), provides a target price of $31.94.
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Mr. Jay Pasch is a private futures and equities trader based in Minnesota. He may hold positions in the instruments mentioned in his trading ideas.
