Tech fought hard in yesterday’s battle but it appears to be losing the war. We looked at a cheap way to play the AI slide yesterday and despite the move on the chart up to the close, there is a more powerful force working in our favor. In fact, there are two very strong factors that are favoring our trade.
There is another way to look at our trade that reveals the bigger picture and we are going to pull up that chart and point to exactly what makes us want to hold out.
Take a look and see for yourself.
Since SQQQ is based on QQQ, looking at the chart of the root ticker the ETF tracks can help offer clarity. Currently, QQQ is still in a downtrend. In fact, overnight it took a beating before scraping its way back to the plus side. That solid momentum down and the dip overnight show that sellers have a solid grip on tech and AI right now.
In addition, we are seeing the rotation we looked at in a couple of last weeks trades really start to manifest. Money is shifting to energy, retail and other sectors as traders move away from AI as it gets more risky.
This solid downward pull is enough to give me confidence that yesterday’s jump up is a not sustainable and that AI is gong to pull the tech sector farther down.
Today will be telling so look in your inbox for an update on how this plays out throughout todays session,
Keep learning and trade wisely.
John Boyer
Editor
Market Wealth Daily
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