Watch The Nasdaq-100 Trust (NASDAQ: QQQQ) Says Market Timer Frank Kollar

February 21, 2006 (By Frank Kollar)

The exchange-traded fund Nasdaq-100 Trust (NASDAQ: QQQQ) should be closely watched for clues to the market’s direction in coming weeks. On Tuesday The Nasdaq Composite Index (COMPQ) closed at 2513.04, which is a new rally high and a new 2006-2007 high. This level was critical to further advances and has now been surpassed.

We have also been watching the Nasdaq 100 Index (NDX) which has not yet broken out to new 2006-2007 highs, but is close and may very well do so in the next day or two. The small caps have also made new highs as seen in the Russell 2000 Index (RUT).

These indexes have lagged for months as the S&P 500 Index rallied. This bearish divergence could not be sustained, but with strength coming into the Nasdaq and small caps, we may very well be seeing the beginning of a new leg up in the stock market.

If the Qs can surpass $45.31 in coming days, the rally will be alive and well.

Kollar’s research has shown that the financial markets are in tradable trends approximately 80 percent of the time. FibTimer strategies define trends and trade them in both advancing and declining markets. Caring nothing about what newscasters say or what the latest economic indicator predicts, trends are where the profits are, and that is where FibTimer is.

Kollar is editor and chief analyst at FibTimer.com (http://www.fibtimer.com) which offers market timing strategies for S&P and Nasdaq index fund traders, as well as bond, gold, small cap, sector, ETF and stock trading strategies.