QQQQ Chart – Hitting Resistance

I drew a candle chart of PowerShares QQQ Trust Series (QQQQ) when it was trading at 39.48 at 3:15 pm on July 23, 2009. 

I see QQQQ hitting resistance here at the point of its trend line of higher highs.  From this line it can move slightly higher each day or even sideways, but is more likely to take a dip before moving too much higher.  Adding to the theory of the QQQQ being ready for a break, the Williams %R indicator for the 14 and 28 day periods are both at the very top of their oversold areas. 

 On a very unsophisticated measure, QQQQ has been up every day for the past 12 days (including today).  Just like betting on black every time in roulette, “betting” that any stock/ETF will falter the next day just because it’s been up for a while is a big gamble.  That said, I don’t think QQQQ has many more days it can pull this off.  I’ll be selling a vertical put spread once I see a decent dip.  If you are more aggressive you could enter a bull put spread now and try to close the long put for a profit on the dip and leave the short put exposed while you wait for a recovery.  I’m not taking that risk, yet.