NASDAQ 100: Positive Bias

On July 22nd, the NASDAQ 100 closed with an RSI(5) reading over 90. Over the next 4 days, it continued to make higher highs while the RSI remained above 90. Over the last two days, the NASDAQ finally took a breather and with that pause, the RSI(5) fell sharply below 50. Such sharp declines after only recently showing very strong relative strength appears to be short term bullish.

The table below shows that the NASDAQ 100 is trading higher than the trigger date 89% of the times when this setup has occurred in the past. In most cases, it is trading higher within two days. (Note, the '3Day+' column indicates the day when the NDX was trading lower than the trigger date)

Ticker			Date/Time					Close		3Day+			PctChg N1				PctChg N2					PctChg N3
^NDX			1/14/1999					1,906.12		1.00			3.96				6.69					6.69
^NDX			1/21/1999					1,961.76		1.00			0.12				1.80					5.12
^NDX			1/22/1999					1,964.21		1.00			1.68				4.99					3.37
^NDX			1/4/2000					3,546.20		0.00			-1.10				-5.79					-0.47
^NDX			1/5/2000					3,507.31		2.00			-4.75				0.64					5.99
^NDX			1/6/2000					3,340.81		1.00			5.65				11.27					6.09
^NDX			1/7/2000					3,529.60		1.00			5.32				0.42					-1.46
^NDX			1/11/2000					3,544.35		2.00			-1.87				1.91					4.53
^NDX			1/12/2000					3,478.14		1.00			3.85				6.51					8.04
^NDX			9/6/2000					3,837.62		1.00			3.02				-0.63					-3.41
^NDX			9/8/2000					3,813.44		0.00			-2.80				-3.84					-1.88
^NDX			9/11/2000					3,706.74		2.00			-1.08				0.94					0.83
^NDX			9/12/2000					3,666.87		1.00			2.04				1.92					0.26
^NDX			9/13/2000					3,741.75		0.00			-0.12				-1.75					-4.18
^NDX			9/14/2000					3,737.42		3.00			-1.63				-4.06					0.51
^NDX			9/15/2000					3,676.33		2.00			-2.47				2.18					3.10
^NDX			9/10/2003					1,332.28		1.00			1.39				1.90					1.16
^NDX			9/11/2003					1,350.80		1.00			0.51				-0.22					2.37
^NDX			9/15/2003					1,347.77		1.00			2.60				2.15					3.88
^NDX			1/22/2004					1,530.42		1.00			0.05				1.52					-0.73
^NDX			6/7/2005					1,531.12		2.00			-0.22				0.54					-0.66
^NDX			11/29/2005					1,676.84		2.00			-0.26				1.64					1.92
^NDX			11/30/2005					1,672.56		1.00			1.90				2.18					1.33
^NDX			12/8/2005					1,685.59		1.00			0.42				0.76					1.20
^NDX			11/27/2006					1,775.17		1.00			0.29				0.99					0.91
^NDX			11/28/2006					1,780.34		1.00			0.70				0.61					-0.29
^NDX			12/1/2006					1,775.12		1.00			1.40				1.67					1.35
^NDX			5/10/2007					1,875.20		1.00			1.26				0.69					-0.18
^NDX			8/6/2009					1,600.29		0.00			0.00				0.00					0.00