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U.S. equity index futures slip: S&P 500 off ~0.2%
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Euro STOXX 600 index off ~0.2%
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Dollar, crude decline; gold up, bitcoin gains >2%
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U.S. 10-Year Treasury yield rises to ~3.96%
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NASDAQ 100 TRIPLE-Qs: GOING WITH THE FLOW? (0901 EST/1401
GMT)
The Invesco QQQ Trust Series 1 , which tracks the
Nasdaq 100 index , took a beating last year, losing 33% of
its value. That said, amid that weakness, one indicator, the
money flow index (MFI), survived tests of a long-term monthly
support line.
Now, early in 2023, along with burgeoning QQQ strength, the
MFI has vaulted to a more than one-year high:
Amid last year's collapse, and despite a series of lower QQQ lows, the MFI, and indicator that incorporates both price and volume, held the support line from its 2002 trough. That support line proved to be a staging ground, ultimately leading to an upward QQQ reversal, which saw the ETF hit a six-month high in February. Given the MFI's tendency to respect long-term monthly support and resistance lines, 2022 may have marked a significant trough for the indicator. However, the MFI, now just over 53, will need to clear the resistance line from its 2014 high, now around 61, to add credence to the bullish turn.
Conversely, an MFI reversal and break of its 2022 low, at
28.7, would see it spill out of its long-term channel. That
could suggest potential for QQQ to see another waterfall slide
given the substantial room before the indicator would reach its
2009 trough at 16.6 or its 2002 low at 11.2.
(Terence Gabriel)
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(Terence Gabriel is a Reuters market analyst. The views
expressed are his own)
