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Back in my January 11 post, I noted that we needed to redraw our longer-term trendline on the Qs due to their having hit a “higher high.” Well the S&P did the same thing last week, so we’re a bit overdue in redrawing that one. Here’s the previous trendline with the December break:

The previous high was 1431.81, set on both 12/18 and 12/19. A new high of 1433.93 was hit on 1/16, and another one (and the current “highest high”) on 1/17 at 1435.27. This requires us to take a few steps back and redraw the trendline so that it goes through the most recent “minor low before the highest high”:

As you can see, this resets the S&P to “still in an uptrend” status, just like the NDX. What to do about it? Well, for one, it cancels our plans to get short on a retrace- and- failure. For that plan, we now need to wait for a break of the current, correct trendline. In the meantime, we may be looking for a spot to get long if a setup, um, sets up.

Now for the quiz. Here are charts of some famous Nasdaq stocks from the last few days. Can you name ‘em?

No, no. Don’t bother naming ‘em. What I’m actually trying to show here is how similar the first three are, and how the fourth has formed a different pattern. The first three are AAPL, GOOG, and QQQQ. That fourth one is CSCO, and notice how it’s showing some leg.

Here’s the complete chart:

If the top of that hammer were a bit lower (where it left the entire tail hanging down checking how deep the water is), it’d be classic. Its being “in the pattern” makes it a somewhat weaker signal, but still might be good for a long daytrade or swing trade entry tomorrow. And lest we forget, as goes Cisco, often goes the Nasdaq. Let’s watch…