On Friday we noted support at 53.50 in QQQ.  Today, that level...

On Friday we noted support at 53.50 in QQQ.  Today, that level is breaking down with authority.

From a technical perspective, now that 53.50 support has broken is should act as resistance.  Also, this support break indicates a Bearish Consolidation Breakout (BCB).  With regard to the BCB, the move is measured by subtracting the height of the consolidation pattern (yellow oval) from the price point at which consolidation support broke (red oval).  In this case, the height is 5.50 (59.00-53.50) and the support level is 53.50, giving QQQ a downside target of 48.00 (green oval). 

This formation can be taken advantage of by shorting QQQ with a stop just above the 53.50 support turned resistance level, or a variety of bearish Options positions. 

We currently do not have many positions on the books, but all of our existing positions are losing positions.  Most have defined risk, but a few are long term Equity holdings.  In an effort to hedge against the further downside pain that this chart indicates may occur, we initiated a hedge using a QQQ 51/53 Bear Put Spread.