QQQ back in long term channel. What's next?

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After spending about a month above the long term blue channel since 2009 (excludes COVID bubble), QQQ is back inside the blue channel. You can see the gap up on June 12th and gap back down on July 24th. The black channel goes all the back to 2008 and the bottom of the market and includes the COVID bubble. The black mid-channel is currently acting as support. The AI rally starting in Jan 2023 has been confined to the purple channel. I see a couple of options for the next week or two. First, we could see a rally to test resistance of the purple channel. It is possible that we jump back above and the AI rally continues, but that fells unlikely. Second, it seems to me a bigger correction could be in store to break the purple channel support down to the red trend line. The core batch of tech earnings is up the next week or so, and that is going to have a lot to do with the direction.

Weekly

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Breaking the thin black trendline last week end the current wave up. Now we have a new line to watch. If it stays above the new black trend line we are still bullish, but the top of the channel will be resistance unless tech earnings this week are a blowout. Maybe we will see more sideways action like at the beginning of the year.

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Let's see if tomorrow is a bounce or a slide. I once again nibbled on a few stocks like AMD that I think are going to bounce even if the QQQ does slide. It always a bit of a gamble. No risk, no reward.

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Looks like an attempt to test resistance.

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Rejected off of resistance and a big pullback all in one day. That is why I only "nibble" on a few good stocks the other day. AMD did pop as expected but lost all that yesterday to the larger market pullback. We still have the probability of falling farther. I think the saying is "don't try to catch a falling knife".

Tech is in a big down draft right now as investors are taking profits from these bubbled and overvalued AI tech companies. My feeling is that we are head down to break below the purple channel's support and likely find more solid support on the red trend line.

My biggest concern is the idea that the expected interest rate cut in September is going to juice the market is "buy the rumor, sell the news". Now that is seems like a done deal, the big investment firms are selling.