The Weekly Scorecard
The Invesco QQQ Trust, QQQ, demonstrated significant strength this past week, outperforming the S&P 500 (SPY). As the Nasdaq-100 index itself, QQQ's performance is the benchmark for large-cap growth and technology, and it served as a market leader over the last five sessions. This divergence highlights a renewed appetite for growth-oriented assets among investors.
The relative strength of the Nasdaq 100 was clear when compared against the broader market. This type of performance comparison is critical for asset allocation decisions. Investors can review more in-depth QQQ Analysis or use advanced tools to see the charts that matter on TrendSpider for a clearer picture of relative performance.
Why It Moved
This week's outperformance was not driven by a single company's news but rather by broad macro-economic factors. Cooler-than-expected inflation data and dovish commentary from Federal Reserve officials fueled a risk-on sentiment. These factors tend to disproportionately benefit the high-growth technology names that constitute the majority of QQQ's holdings.
When interest rate expectations fall, the future cash flows of growth companies are discounted at a lower rate, making their valuations more attractive. This dynamic caused a sector-wide rally in technology and tech-adjacent industries, lifting the entire index higher throughout the week.
The Weekly Chart
Analyzing the weekly candle reveals a very bullish picture for QQQ. The index printed a long-bodied green candle, closing near the absolute high of the week. This price action signifies strong, sustained buying pressure and a lack of profit-taking into the weekend, which is a sign of conviction from buyers.
Currently, the index is pushing up against a key resistance area near the $630-$637 zone, which represents the prior all-time highs. A clean close above this level on the weekly timeframe would signal a significant breakout and potential for further upward continuation.
Next Week's Playbook
The key level to watch for next week is the weekly high, which now acts as immediate resistance. A decisive break and hold above this level would confirm the bullish momentum and could trigger a move toward new, uncharted territory. Traders will be watching for follow-through buying early in the week.
Conversely, if the market digests this week's gains and pulls back, the first area of support to watch would be around the $600 psychological level. A failure to hold this area could indicate the recent move was exhaustive, potentially leading to a retest of lower support zones.
Content is for info only; not financial advice.