Shorting QQQ: Day Trading Strategy

Nasdaq tends to chop around on most trading sessions, especially during the bull markets. Even when the index prints a net gain for a session, its intraday trend is usually lacking direction and generates a lot of false positive intraday moves. However, when index sells off, its intraday trend is much more pronounced, which yields a favorable risk-reward short-selling day trading opportunity.

I use the following tools / indicators to help time my QQQ intraday shorts:

  • Nasdaq’s Advancing-Declining Issues indicator (ADQDC in ThinkorSwim)
  • Nasdaq’s Declining Issues indicator (DECNC/Q in ThinkorSwim)
  • Nasdaq’s Up Volume – Down Volume Indicator (VOLQDC In ThinkorSwim)
  • Nasdaq’s TICK Indicator (TICK/Q in ThinkorSwim)
  • Nasdaq’s Bullish Percent Index (BPCOMPQ in stockcharts)
  • Nasdaq’s 1m Point&Figure and Renko charts (charts in TradingView)
  • TTM Squeeze and TRIX in ThinkorSwim

The best trading opportunities come when all of these indicators are aligned. During the bull markets only 15% to 20% of trading sessions will offer shorting opportunities. During the bear markets, this number will be around 40%-50% of the trading days.

Below are some of the examples:

March 03, 2021

ADQDC

DECNC/Q

VOLQDC

TICK/Q

NDX, Point&Figure and Renko

BPCOMPQ and NDX

TTM Squeeze and TRIX

February 22, 2021

ADQDC

DECNC/Q

TICK/Q

VOLQDC

BPCOMPQ

NDX, Point&Figure and Renko Charts

QQQ, TTM Squeeze and TRIX

February 10, 2021

ADQDC

DECNC/Q

TICK/Q

VOLQDC

BPCOMPQ

Point&Figure and Renko charts

QQQ, 1m

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