Working Money magazine.  The investors' magazine. Advantage



Article Archive | Search | Subscribe/Renew | Login | Free Trial | Forgot ID?



Which Way Is The Nasdaq Headed?

02/06/03 09:50:46 AM
by Dennis D. Peterson

A descending right triangle seems to have formed.

Security:   N/A
Position:   N/A

Right triangles are one of the more reliable patterns. Looking at daily data for QQQ you see a price pattern closely resembling a descending right triangle (Figure 1).

Figure 1: Daily QQQ Price And Volume. Trendlines drawn along the peaks and valleys of recent price history nearly forms a descending right triangle.
Graphic provided by: MetaStock.
Graphic provided by: Data Vendor: eSignal.
The price pattern is only close to a descending right triangle because the bottom trendline is not perfectly horizontal; however, with an upsloping bottom trendline the pattern forms a bearish wedge. Either way, wedge or triangle, the pattern favors bears and shorts. Does the Nasdaq composite say anything different?

Figure 2: Daily Nasdaq Composite Price. A gap down is a strong indication that the triangle base will be the target before a reversal is seen. Currently, 1150 is in play.

The Nasdaq composite gives a clearer picture that we have descending right triangle and today's gap down only confirms a move down. Ideally prices would been coming down into the pattern. Nevertheless the odds favor shorts. VXN should confirm.

Dennis D. Peterson

Market index trading on a daily basis.

Title: Staff Writer
Company: Technical Analysis, Inc.
Address: 4757 California Ave SW
Seattle, WA 98116-4499
Phone # for sales: 206 938 0570
Fax: 206 938 1307
E-mail address:

Traders' Resource Links
Charting the Stock Market: The Wyckoff Method -- Books -- Online Trading Services Advantage -- Online Trading Services
Technical Analysis of Stocks & Commodities -- Publications and Newsletters
Working Money, at -- Publications and Newsletters Advantage -- Publications and Newsletters
Professional Traders Starter Kit -- Software

Click here for more information about our publications!

Comments or Questions? Article Usefulness
5 (most useful)
1 (least useful)


S&C Subscription/Renewal

Request Information From Our Sponsors 

DEPARTMENTS: Advertising | Editorial | Circulation | Contact Us | BY PHONE: (206) 938-0570

PTSK — The Professional Traders' Starter Kit
Home — S&C Magazine | Working Money Magazine | Advantage | Online Store | Traders’ Resource
Add a Product to Traders’ Resource | Message Boards | Subscribe/Renew | Free Trial Issue | Article Code | Search

Copyright © 1982–2019 Technical Analysis, Inc. All rights reserved. Read our disclaimer & privacy statement.