The Q's (NASDAQ: QQQQ) are pressing towards a 50% giveback of the prior 5-session upmove, at 27.25, which is the next significant support plateau beneath the 11/25 pullback low of 27.52. If 27.25 does not contain the selling pressure, then we should expect downside continuation that fills the gap area from 11/24 in the 27.00-26.65 target zone.

However, the extreme oversold condition on a micro timeframe suggests strongly that an intervening rally could very well emerge that propels the Q's to 28.30/50 prior to another loop to the downside that fills the gap. Keep in mind that such a scenario --intervening rally and then another decline to fill the gap -- all could occur between now and tomorrow morning, after which my short-term pattern work argues for upside continuation into recovery high ground.

By Mike Paulenoff

Mike Paulenoff is author of the MPTrader.com (www.mptrader.com) , a real-time diary of Mike Paulenoff's trading ideas and technical chart analysis of Exchange Traded Funds (ETFs) that track equity indices, metals, energy commodities, currencies, Treasuries, and other markets. It is for traders with a 3-30 day time horizon, who use the service for guidance on both specific trades as well as general market direction

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