Heading into the final hour of trading, my work argues that Monday's low in the QQQQ at 41.39 ended the pullback from the April 7 high at 43.05. Furthermore, if the rally from Monday's low at 41.39 started a new upleg (as my work suggests), then the initial phase of the upleg ended this morning at 42.82. And if that is correct, then all of the action off of this morning's high at 42.82 represents a minor pullback (perhaps incomplete) ahead of another thrust that should propel the Q's to new 2006 highs above 43.31. Right now, any forthcoming weakness should be contained in the 42.20/10 area ahead of the expected next rally effort. Only a plunge that breaks Monday's low at 41.39 will wreck the overall bullish pattern.

Mike Paulenoff is a 25-year veteran of the financial markets and author of MPTrader.com, a real-time diary of his E-mini S&P and QQQQ technical analysis and trading alerts. For more of Mike Paulenoff, sign up for a FREE 30-Day Trial to his E-Mini/Index Futures diary, or try his QQQ Trading Diary