NQ Stalemate 7/31/2020
Well, here is the NQ bounce around earnings. All this drama just to be in the same trading range for the past 3 weeks.
The NQ has reached a trading range. It might break a new high, but nothing spectacular like it did pre-July 13th.
Currently, retail traders and Robinhooders are chasing/FOMOing into tech. They got the trading alert to go long for tech. However, institutions also get those alerts too. As a result, the NQ may be in the distribution phase for several days - possibly weeks.
The institutions are using their profits from tech shares and propping up non-tech sectors that are undervalue, but highly critical (e.g. financials and transportation). That's why the Russell has been on steroids recently as it is mostly non-tech.
Still, what is keeping the NQ alive at this point are chasers, high liquidity from the internals, and many, many permabears covering their shorts.
In the face of high liquidity, that's why you don't short. You can try to justify your short all you want. The way I see it, the market is like nature. If you don't adapt, you die. You can wish it the NQ to fall big time, but it won't happen until much later. It's like wishing for hotter weather in January and going outside without a coat. The market (like nature) will find a way to punish those who refuse to adapt.
The NQ has reached a trading range. It might break a new high, but nothing spectacular like it did pre-July 13th.
Currently, retail traders and Robinhooders are chasing/FOMOing into tech. They got the trading alert to go long for tech. However, institutions also get those alerts too. As a result, the NQ may be in the distribution phase for several days - possibly weeks.
The institutions are using their profits from tech shares and propping up non-tech sectors that are undervalue, but highly critical (e.g. financials and transportation). That's why the Russell has been on steroids recently as it is mostly non-tech.
Still, what is keeping the NQ alive at this point are chasers, high liquidity from the internals, and many, many permabears covering their shorts.
In the face of high liquidity, that's why you don't short. You can try to justify your short all you want. The way I see it, the market is like nature. If you don't adapt, you die. You can wish it the NQ to fall big time, but it won't happen until much later. It's like wishing for hotter weather in January and going outside without a coat. The market (like nature) will find a way to punish those who refuse to adapt.