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Today's Qs Are Nearly Identical To Pre-Crash Nasdaq 1987

Today's QQQQ chart shows a Double Top formation with heavily sloped negative divergences on oscillators, which bares striking similarities to that of the Nasdaq Crash of 1987. The two charts have a nearly identical pattern with the primary difference being the slope of ascent.

First, review the Double Top formation that occurred in 1987 on the Nasdaq shortly before the waterfall decline noting negative divergences on the RSI, CMF, MACD and the ADX. Consider that the technical patterns in all four were correctly indicating well ahead of time that a substantial decline was imminent:

Compare to today's daily QQQQ Nasdaq 100 ETF with the same oscillators:

If one is to estimate that the anticipated decline ahead would be as ruthless as it was then, based on the percentage decline on the Nasdaq 1987 chart which was 36.8% from the Double Top highs, a target for the Qs would be 27.34, as annotated.

In addition to the Qs, a trifecta of bearish Double Top formations would include those which have developed on the Russell 2000 and Dow Jones Transportation index as well. Also consider that although the S&P 500 and DJIA have ascended past their Double Top patterns, the negative divergences on their oscillators are as bearish as those above which doesn't lend confidence to those indices moving to new highs anytime soon, although anything is possible.

I am not an investment advisor, just a commoner with some dangerous looking charts, so do your own due diligence as chance favors the prepared.

 

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