QQQ Faces Downtrend with 5% Pullback; 54% of Nasdaq 100 Stocks Above 50-Day SMA and Evening Star Formation

The Nasdaq-100 ETF, QQQ, is currently experiencing a significant downtrend, with analysts noting critical support levels forming around the 50-day moving average and a gap from June 12, 2024. Recent data indicates that 54% of stocks within the Nasdaq 100 are trading above their 50-day simple moving averages (SMAs), marking the lowest level since early June. A 5% pullback has already occurred, with traders closely monitoring the 50-day close and a small open gap as potential areas for a reversal. Analysts also point to a possible 'Evening Star' formation on the weekly chart at the 1.618 Fibonacci extension. Other sectors, including the S&P 500 ETF (SPY) and the Financial Select Sector SPDR Fund (XLF), are also showing signs of pullbacks, with SPY experiencing a 3% decline and XLF pulling back from all-time highs. The focus remains on whether these sectors can hold their current levels or if they will drop further, particularly with QQQ's critical levels in sight.