The market, particularly the tech-heavy Nasdaq 100 (QQQ) continue to push higher this week. The rally that began on December 19th has barely paused for a breather. But, if you look closely at the last four trading days it seems as though we are setting up for a move lower as the ETF seems to be struggling with strong overhead resistance.
Most of the highly- liquid ETFs I follow have pushed into a short-term overbought extreme, with several actually reaching a very overbought extreme.
Typically, when we see this type of price action, that is an upside gap (1/3) into overbought to very overbought territory at strong overhead resistance, a short-term reprieve is to be expected.
However, if you recall, I expected to see a reprieve last week, but the gap in the tech-heavy Nasdaq 100 has yet to close.