Chart of the Day - Wednesday, October 4, 2023

Today’s Chart of the Day was shared by Steve Strazza (@sstrazza). The Nasdaq 100 ($QQQ) is attempting to invalidate the Head & Shoulders top that formed over the Summer. Bears will be trapped below support if $QQQ reclaims the neckline, around $360. The best Head & Shoulders patterns are the ones that fail, as they're often followed by sharp moves higher. Steve points out that the Technology sector ($XLK) is also attempting to invalidate its respective H&S top. Tech is easily the most important sector of the S&P 500, representing over 25% of the index. Remember, we're approaching what has historically been a seasonal inflection point where the calendar will flip from bearish to bullish in less than two weeks.