So we're in the midst of a bear market and I'm longing for a robust bear market relief rally, the likes of which we had on October 28, 2008 as depicted on the 5 minute NQ emini futures chart below.
Looking at the daily closes on Friday, I noticed that the QQQ is very close to a retest of the August 9th post FOMC lows, whereas the SPY and DIA have a ways to go. Compare the charts of the SPY and QQQ below.
History doesn't repeat itself, but....if we compare the October 2008 charts of the SPY and QQQ and you'll see what I'm getting at. The SPY held the initial reaction low as support throughout the month of October 2008 and well into November, but the QQQ breached the previous low early on two separate occasions, each time resulting in a reversal and bounce. The second breach preceded that huge parabolic day trade depicted in the upper half of this post.
So be ready if a similar scenario develops next week. I can envision a breach of support in QQQ, but if the SPY and DIA don't confirm, we should get the highly anticipated relief rally.