This is a long-term weekly chart of the Powershares QQQ Trust (QQQQ:NASDAQ). It represents the Nasdaq 100 index -- in other words, the biggest tech stocks around.

The blue and red lines are the 20- and 50-week moving averages. Note that the Q's are trading well above their averages -- a bullish sign. Also note that the recent downdraft feels more like a correction in a sustained upward push, rather than a rally failure or new leg of downturn.

This stands in marked contrast to weekly charts for the S&P 500 and Dow Jones ETFs (SPY and DIA, respectively). Both have a much bleaker outlook, and both are trading below their key moving averages.

This big divergence shows how leadership has shifted to tech stocks in recent months. If the bulls put together a broad market rally anytime soon, some of the stronger tech names could thus be worth watching.

Justice Litle
Editorial Director, Taipan Publishing Group

 

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