QQQ has lost 4.47% in the past 5 days, which we argue is just a pullback after a strong rally.

• The outlook for QQQ was bearish between 2022 and 2023 due to macroeconomic challenges like rising interest rates and inflation.
• Since 2023, the outlook has been very bullish, supported by a "golden crossover" where the 50-day moving average crossed above the 200-day moving average.
• The 200-day moving average has not been breached since this golden crossover, indicating strong long-term support.

In mid-2024, QQQ came very close to the 200-day moving average due to several macro and geopolitical drivers. The current pullback is likely attributed to uncertainty surrounding NVIDIA earnings. Now that the earnings have passed, we expect a period of range-bound trading as the market digests recent development and a resumption of the uptrend driven by positive fundamentals and improved investor sentiment.

The long-term trend for QQQ remains bullish, but risks include earnings volatility from key components like NVIDIA, Apple, and Microsoft. The Macroeconomic risks such as inflation, geopolitical tensions, or unexpected central bank actions can cause concerns. The confirmation is when 200-day moving average is breached.

The recent pullback in QQQ is likely temporary, with consolidation followed by a potential rally as long as macroeconomic conditions and earnings trends remain favorable.

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