By: Jeff Cooper

Hit and Run Trading Morning Report - February 29, 2024

Editor's Note: there are two reports today. Scroll down to see the second one.

QQQ OpEx Pinball

The leading QQQ shows 5 waves of multiple degrees may have culminated for a 5th of a 5th of a 5th wave top on February 23 at 440.59.

Markets like to test highs and lows and those test confirm/validate the trend.

On the February high, the Q’s left a signal reversal bar (Gilligan’s Island) on a test of the prior high on February 12th at 439.14.

Importantly, February 12th was also a signal reversal bar, a new all-time high with a ‘tail’ that produced a close near session lows.

As well February 12th was a Time/Price square-out with 439 squaring Feb 12.

The Q’s snapped a Bottoms Line from late October 2023  on February 21st in tandem with a turn down of the 3 Day Chart.

It was only the second time the Q’s turned down their 3 Day Chart since the melt-up started in late October 2023.

Following the Feb 21 turn down, the Q’s erupted with a massive upside gap courtesy of NVDA’s earnings.

The gap reclaimed the reclaimed the red Bottoms Line. Until yesterday when it closed a tad below the line. It is not an authoritative break but it warrants caution should we get downside follow thru.

While the Q’s are perched above their 20 day moving average, they also show what looks like 3 Drives To A High from the January 4th spike high.

As you recall we wrote in early December that the market should base from December 21st into mid to late January before a phase of pops and drops, spikes and gaps.

The price action for 2024 certainly is consistent with that forecast.

In sum, QQQ left a 1 2 3 Pullback buy setup on Wednesday’s close at 435.27.

Either today’s inflation data will produce a rally out of the setup testing the 439 square-out or

It will perpetuate a decline to test the 20 day moving average at 431.

Consequently going into Friday’s Opex the 440 strike and the 430 strike loom as ‘pins’.

OKTA’s Home Run Setup

Checking a daily OKTA for the last two months prior to Wednesday’s Earnings Explosion’ showed a lot of sideways chop.

However if you pull back the lens to the weeklies you see what I call a big picture Sherlock’s Pipe bullish setup.

OKTA rolled over from its late 2021 top carving out a bowl off the bottom into January 2023.

It’s been coiled for a year building a potential Rule of 4 Breakout…a breakout over triple tops.

In the Sherlock’s Pipe setup (which works on dailies too), once the stock comes out of the ‘bowl’,

It smokes the shorts who think it was dead in the water.

From the November 2023 low at 65, a 360 degree move up is 101.

Notably 65 squares out with early November.

So the minimum projection was 101 on an earnings beat.

OKTA exploded above 101 after reporting to 111 pre-open today.

111 is 90 degrees up from 101.

Clearing 111 opens the door to a full cube-out at 121.

What’s the Square of 9 Time/Price Calculator worth?