QQQ Maxes Out Price Channel Melt-Up

QQQ is Maxing Out the Price Channel Melt-Up Set-Up Inside Its Blue Rising Wedge

QQQ is Maxing Out the Price Channel Melt-Up Set-Up Inside Its Blue Rising Wedge

QQQ confirmed a price channel melt-up set-up at its last trip to the bottom of the blue rising wedge on the daily chart.  Now it’s maxed out its price channel roll-ups and is heading up into the start of a top.

QQQ can start the top on this melt-up anywhere inside the rising wedge or a little bit through its top.  The only thing it can’t do is complete this rising wedge with an exact tag of the rising wedge top.

The top on this melt-up within the rising wedge can end with a megaphone, head and shoulders, triangle top or smaller rising wedge top.  QQQ could even tag its blue rising wedge top, return to the rising wedge bottom, and then extend the blue rising wedge with two more higher highs between tags of the wedge bottom.

Once ES completes the blue rising wedge, it must retrace to at least the level of the lowest touch on its bottom.  But it could correct a lot further.

When QQQ Retraces to Its Blue Rising Wedge Bottom, It's Also Retracing To the VWAPs of Two Megaphones & Could Collapse to Their Bottoms

When QQQ Retraces to Its Blue Rising Wedge Bottom, It’s Also Retracing To the VWAPs of Two Megaphones (Gray & Navy) & Could Collapse to Their Bottoms

When QQQ retraces to its blue rising wedge bottom it will also be putting in a mandatory retrace to the VWAPs (volume-weighted average prices) of two long-term megaphones (gray and navy on the chart above). If QQQ breaks out through those VWAPs, the next target would be the megaphone bottoms.

Ultimately QQQ must retrace to the bottoms of the blue and silver rising megaphones on the long-term chart above (the blue formation’s bottom is at 42).  But QQQ could extend this move up (purple and rose scenarios) before completing that retrace.

Little Price Channel is Key to What’s Next

ES has Formed a Little Price Channel (Navy Blue) at the Top of its Purple Megaphone and Blue Rising Megaphone

ES has Formed a Little Price Channel (Navy Blue) at the Top of its Purple Megaphone and Blue Rising Megaphone

ES has formed a new little price channel (navy blue) overnight. This price channel is now in the critical decision wave for starting a top vs breaking out into a melt-up.

Since ES just tagged the top of its blue rising megaphone, it’s more likely this channel will start a top. If it does break out into a melt-up, we’ll likely be redrawing that rising megaphone.

Price Channel Melt-Up (Green) vs Topping (Purple)  Scenarios

Price Channel Melt-Up (Green) vs Topping (Purple) Scenarios

If ES does break out into the green melt-up scenario, we’ll be drawing a series of roll-up melt-up channels on the chart that will tell us when the move is ending. ES could easily go for 2400.

If ES begins a top instead, it is likely to be the top before a pullback to 2150.

Euro Price Channel in Critical Decision Wave

Euro Futures have Just Confirmed the Red Price Channel & are in the Channel's Critical Decision Wave for Starting a Top vs Starting a Melt-Up

Euro Futures have Just Confirmed the Red Price Channel & are in the Channel’s Critical Decision Wave for Starting a Top vs Starting a Melt-Up

Euro futures have just confirmed the red price channel and are in the critical decision wave for breaking out the channel into a melt-up vs. starting a top.

Minimum Melt-Up Target would be the Top of the Navy Blue Falling Wedge

Minimum Melt-Up Target would be the Top of the Navy Blue Falling Wedge

The minimum target for the green melt-up scenario would be the level of the top touch on the top of the euro’s falling wedge on the daily. The euro could go as far as the potential neckline of the big inverse head and shoulders (H&S) on the chart at roughly the May 2, 2016 high.

A top here would mean at least a right shoulder pullback for the potential smaller inverse H&S on the chart and could mean a double bottom or new low.

The euro has a long-term target of its September 2000 low.

QQQ Rising Wedge

QQQ has Broken Out of its Blue Price Channel into the Red Roll-Up Price Channel within the Navy Rising Wedge

QQQ has Broken Out of its Blue Price Channel into the Red Roll-Up Price Channel within the Navy Rising Wedge

QQQ has made a legal breakout from its blue price channel into the red roll-up price channel within the navy blue rising wedge.  It’s already pierced the top of its red channel, so that makes a partial pullback and move up into the start of a top (green scenario) most likely.

The green scenario would usually be capable of much more of a final melt-up, but I’m assuming it will be limited by the top of the navy rising wedge.  The green scenario does not have to top with a megaphone–it could extend this move up with something like a rising wedge top for an extended navy blue rising wedge.

The alternate purple scenario represents QQQ putting in the head of a head and shoulders top for the blue price channel.

When QQQ completes the navy blue rising wedge it will also be completing a wave up within the orange megaphone.  The retrace target for the navy rising wedge is the formation bottom, which is at roughly the orange megaphone VWAP (volume-weighted average price).

QQQ could reverse at that VWAP after a bottoming pattern that tags a larger megaphone’s VWAP at roughly 97.60.  Or it could continue down through the orange megaphone VWAP to the megaphone bottom.

The likelihood of a turn at VWAP vs collapse to the megaphone bottom will be determined by how long it takes QQQ to top before that trip down.

Gold Price Channel

Gold has Confirmed the Red Price Channel on its 60-Minute Chart & is in Its Critical Decision Wave

Gold has Confirmed the Red Price Channel on its 60-Minute Chart & is in Its Critical Decision Wave

Gold has confirmed the red price channel on its 60-minute chart and is in the channel’s critical decision wave. That’s where the channel usually either starts a top or breaks out into a melt-up.

The Melt-Up Scenario Could Retest the July High or Even Break Gold Out of the Big Blue Megaphone While a Top Here Could Lead to Further Consolidation or a Trip to the Big Blue Megaphone Bottom

The Melt-Up Scenario Could Retest the July High or Even Break Gold Out of the Big Blue Megaphone While a Top Here Could Lead to Further Consolidation or a Trip to the Big Blue Megaphone Bottom

If gold starts a top here it could be the top before a crash to the bottom of the big blue megaphone gold has been forming since late 2014. That would be a crash to buy.

A breakout into a melt-up could target a retest of the July 2016 high or even an upwards breakout from the big blue megaphone.

A top here could also lead to a prolonged period of megaphoning across 1200 to morph the big blue megaphone into a triangle. The triangle could break out in either direction but would be a favorite to break out downwards to take gold down into the 700s to put in the final bottom for its correction off the 2011 high.

QQQ Extended Rising Wedge Top

QQQ is Forming an Extended Rising Wedge Top

QQQ is Forming an Extended Rising Wedge Top

QQQ is working on a rising wedge top (navy blue) on a price channel top (blue) for a large rising wedge top (red) that it’s been working on for almost a year.

Once an extended rising wedge breaks out downwards, the move down is usually fast.

QQQ is Working on a Top for this Wave within the Navy & Orange Megaphones & Needs a Retrace to at Least the Navy Megaphone VWAP at Roughly 100

QQQ is Working on a Top for this Wave within the Navy & Orange Megaphones & Needs a Retrace to at Least the Navy Megaphone VWAP at Roughly 100

The red rising wedge is a topping pattern for this wave up within the navy blue and orange megaphones in the long-term chart above.

The red rising wedge is also completing the head of a head and shoulders top for the silver rising megaphone.  That H&S top is a strong favorite to break the price out of the silver rising megaphone to at least the bottom of the blue rising megaphone.

The bottom of the blue rising megaphone will be a long-term critical decision point.

QQQ could bounce off the bottom to take out the high of the right shoulder of the silver rising megaphone’s H&S, turning that right shoulder into a megaphone.  A megaphone in this spot would likely launch another interior megaphone across the navy megaphone VWAP (Volume-Weighted Average Price) to put a big continuation triangle in the blue rising megaphone for a move to new highs (purple scenario).

The green scenario represents a retrace to the orange megaphone VWAP to complete it before taking QQQ down to the navy megaphone bottom and breaking it out of the blue rising megaphone.

QQQ would then retrace to the navy megaphone VWAP and blue rising megaphone bottom for the big decision on whether to put in a trip to another new high vs crash to the blue rising megaphone bottom.

Potential Little ES Price Channel

Potential ES Price Channel (Red) would be Heading Into Critical Decision Wave

Potential ES Price Channel (Red) would be Heading Into Critical Decision Wave

ES has set up a potential price channel (red) on its short-term charts. It needs a new high within the channel to confirm. A new high within the channel would put ES in the channel’s critical decision wave for a breakout into a melt-up (green scenario) versus the start of a top (purple scenario).

ES could also morph the price channel into a rising megaphone by moving sideways to break the channel bottom a bit before a new high.

Or it could collapse before a new channel high for a trip down to the bottom of the pink flat-topped megaphone to redraw the orange rising megaphone bottom a bit.

Longer-term scenarios remain the same.

QQQ Price Channel is Working on a Megaphone Top

QQQ is Likely Working on a Megaphone Top for the Red Price Channel

QQQ is Likely Working on a Megaphone Top for the Red Price Channel

QQQ is working on a megaphone after confirming the red price channel. The price channel has been a move up the bottom of a rising wedge, so the megaphone is a strong favorite to eventually break out downwards.

QQQ is Working on Tops for Some Long-Term Rising Megaphones (Blue & Silver)

QQQ is Working on Tops for Some Long-Term Rising Megaphones (Blue & Silver)

QQQ is working on tops for two long-term rising megaphones (blue and silver on chart) and needs to retrace to the formation bottoms.  A fast top here (green scenario) could set up clean head and shoulders tops for both rising megaphones.

The green scenario could break QQQ out of both into a crash to the blue rising megaphone bottom (orange scenario).

The alternate green scenario is that QQQ reverses near the pink megaphone bottom to form one last larger rising megaphone after breakout from the blue one for a fast move to another new all-time high.

The purple scenario represents a slower topping process in which QQQ morphs the move off the February 2016 low into a rising megaphone top (navy blue).  The slower top would virtually guarantee a more complicated and drawn-out correction to break QQQ out of the blue rising megaphone.  This type of breakout would virtually guarantee a move to another new all-time high before the retrace to 42.