|Here are two differing views on the QQQs based on whether your outlook is long- or short-term.|
For those traders with a short-term outlook, I've used my Red/Green trading strategy. To recap, The green line is a 1-day moving average of the HIGH offset forwards by 10 days, and the red line is a 1-day moving average of the LOW offset forwards by six days. The BUY/SELL trigger is the light grayish line and is a 5-day moving average offset forward by one day.
|Figure 1 below is of the QQQ, showing that they are about to give a close buy (long) signal. This is confirmed by the stochastic oscillator which is overbought and beginning to turn down, probably about to give a sell signal.|
|Figure 1: QQQs analysis using Red/Green strategy.|
|Graphic provided by: AdvancedGET.|
|For my second analysis I'm using the JM stragegy. This is for long-term investors. To recap, the JM strategy is based on an internal band of a 15-day moving average offset vertically by 2 percent and -2 percent. The closeout trigger is an optimized moving average to give the best parameters to use as a SELL (closeout long or short) for the QQQs. In Figure 2 the parameters for the optimized moving average are a 13-day moving average (thin red line).|
Figure 2: The JM strategy for investors.
|The chart suggests that there is still a long way to go before a close buy signal will be given even though the oscillator is overbought and possibly giving a sell signal in the near future.|
As an investor, I would therefore hold the QQQs until it broke below the optimized moving average, when I would close out my BUY position. I would only go short when the QQQs break below the bottom channel line.
|So here you have two strategies, both successful but different in that you must decide what type of trading category you fit in. Are you a trader or an investor?|
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