“Like every chart pattern, there is never a guarantee that a head and shoulders pattern will follow through to much lower prices. However, over the years, I have found the head and shoulders to be one of the more reliable chart patterns (but only in a weak or downtrending market),” he said.
A saving grace for QQQ could be its exposure to more mature tech companies, an obvious catalyst for why the ETF has handily outperformed other momentum funds in recent weeks. Microsoft, Qualcomm, Intel and Cisco combine for 18% of QQQ’s weight. [Cisco ETFs]
PowerShares QQQ
ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of Amazon, Facebook, Cisco, Microsoft and QQQ.