Another Flat Day as Dips Continue to Get Bought

The S&P 500 ended roughly flat today as dips last night and today were swiftly bought. This is not surprising because as I said yesterday, asset managers want in (NAAIM only in high 70s), and retail wants to short because stocks are “overbought” which creates buying pressure on every dip. Throw in a ton of positive gamma and you have a market that doesn’t go down.

Table 1 shows the bull flag breakout that occurred on QQQ 0.00%↑ and it now seems to be forming a pennant, which is typically a bullish pattern. This lines up with what I said Friday about the QQQs likely targeting the $400 level as it’s the last call wall and would put price on top of all the major put walls. From there I think it heads lower into December given the number of DeMark trend exhaustion signals and the option data shown in Table 5.

Table 1. QQQ Daily Chart