One of the more noteworthy developments in recent days has been the move in Chinese tech stocks. Despite global new highs, the Guggenheim China Technology ETF (CQQQ) closed lower last week, down 1.1 percent as traders justify the underlying valuations. Nonetheless, CQQQ soared more than 68 percent YTD, outperformed the S&P. Now the question is whether recent pullback is a pause that refreshes or it’s a beginning of something worse? Below is an update look at a trade in the CQQQ.
The graphic below is from our “U.S. Market Trading Map”, show the near-term technical bias and trading ranges. As shown, the underlying is in a short-term bullish trend when the price bars are painted in green. The underlying is in a short-term bearish trend when the price bars are painted in red.
Chart 1.1 – Guggenheim China Technology ETF (weekly)
Our “U.S. Market Trading Map” painted CQQQ bars in red (sell). After peaking earlier last week at 60.75, CQQQ sold off. Last week’s massive bearish engulfing bar is a clear indicating of supply overwhelming demand. Additionally, momentum did not support last week’s new high as the indicator traced out a series of lower highs, which indicates that the loss of momentum in the underlying…Click here to read more.
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