Here is a quick update showing the daily chart of QQQ:
The ETF above is still trading beneath its 50 day moving average and is now hovering below the gap I mentioned last week. If the price closes the gap and makes a new high, that would invalidate my hypothesis.
Also, keep in mind that the long term trend of US stocks remains up, so shorting at this stage would be pre-mature, according to my moving average system.
However, most other markets outside America appear weak and are entering mechanical moving average sell signals for me. For example, emerging market stocks have entered a long term down trend, with the 100 ema sliding below the 150 ema:
Lastly, here is a monthly chart of emerging markets showing price action making a new low:
