With 2 hours remaining in today's session, the Q's are poised to push through key resistance at 38.00, which will mean that the former "neckline" of the recent Head & Shoulders pattern will have been hurdled.  This is a signal that the toppy pattern no longer is valid. Furthermore, such upside action in the Q's comes afetr the bears tried but failed to press the stock beneath the April 29 trendline in the 37.58 area. This morning's low at 37.49 definitely pierced below the trendline, but the bears showed no ability to follow-through on the downside. Since then, the bulls have re-taken control of micro direction. Further strength that hurdles the intraday high at 38.06 should trigger upside acceleration to 38.50, the area of the former "Right Shoulder." At this juncture, only a decline that breaks this morning's low at 37.49 will reinstate the bearish scenario for a run at 37.20, and then 36.60.

MJP 06/09/05 1:55 PM ET 37.85

Click here to view chart (new browser window will open).

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.