X discussionNasdaq 100 ETF QQQ sold off hard after the Fed hiked 25 bps on Sept 16 and Chair Kevin Warsh delivered a hawkish message. Price flushed toward the $700 level into the close, then largely retraced the drop overnight. Traders are fighting over whether that washout marked a bottom or the start of a deeper correction.
BullThe flush was a classic sell-the-news washout and a buying day. QQQ absorbed a dozen stacked negatives including a hike priced above 90% odds, then found a 3:30pm TWAP buyer after a straight-line ~2% drop into the $700 area.
BearThe hike was priced in; the hawkish guidance was not, so this is day-one digestion not a low. QQQ still sits under the 50-day SMA with put/call too low for a solid index bottom while more tightening stays on the table.
Posts
Bull evidence
@TheShortBearQQQ's FOMC washout with every bear catalyst stacked was a buying day, not a sell.
@Mr_DerivativesQQQ has basically retraced the entire intraday FOMC drop overnight.
@WOLF_FinancialQQQ finished green on all four prior first-hike days of Fed tightening cycles, averaging +1.89%.
Bear evidence
@pdicarlotraderFed hike plus hawkish Warsh message sparked a hard QQQ selloff and opens a deeper-correction risk.
@CheddarFlowWhales who loaded millions in OTM QQQ puts ahead of FOMC printed when Warsh spoke and the market dumped.
@traderDanielleQQQ failed the 50-day SMA after the hike; $700 is critical support and this is not yet a low.