Early 90s reference inside (not a good one either)

9/13/2022

I didn’t study computer science, but with technology moving as fast as it does, quantum computing is all the rage.

I’m talking about tech that makes supercomputers look elementary, solving complex problems and identifying patterns according to the laws of quantum mechanics.

Sounds like a “Quantum Leap”…

(Source: giphy.com)
Okay, that’s the best I got.

Still, the application is wide and growing… yet for some reason, a number of quantum technology stocks are sitting near all-time lows…

Which company will buck the trend?

Here’s yesterday’s breakout — Arqit Quantum, Inc. (ARQQ):

Eyes are on the 375-minute chart…

I checked ARQQ on the daily time frame, but the results of the backtest pale in comparison to what the above look gives us:

58% win rate. 1.823 profit factor.

Should we look for an entry?

Oddly enough, it was about a week ago that I put together a watchlist centered on quantum computing, particularly in small caps.

I even told myself to take a position in ARQQ…

(I didn’t.)

You can’t catch them all, but you can always look for the pullback.

Support is noted here by the green arrows and there’s two areas worth watching that line up with the Fibonacci Retracement on yesterday’s move.

At the 78.6% level is ~$5.79 while the Fib Pocket is between $6.25 and $6.58.

One thing though… ARQQ may not retrace that far considering the strength of the pop (notice the Volume spike and Relative Volume on the lower chart).

So, if you’re playing it conservatively, the next trade would be from the top of the Support channel. Call it ~$7.00.

And if you’re ultra-conservative, you can wait for a break above the Resistance channel at ~$8.10 (red arrow).

But what does Chris Hood’s Squeeze Tool say?

All four dots are lit up green and the composite Stochastic is above the zero line, green, and pointing higher…

You could take the trade now and manage it.

Now, be aware that shorts are going to come after ARQQ as they should…

Patience with this one.

This isn’t the market to take wild guesses…

Keep moving,

(Disclosure: I hold no position in ARQQ, but intend to initiate a position in the next 30 days.)

This material is not an offering, recommendation, or a solicitation of an offer to buy or sell the securities mentioned or discussed, and is to be used for informational purposes only. Any performance results discussed herein represent past performance, not a guarantee of future performance, and are not indicative of any specific investment. Due to the timing of information presented, investment performance may be adjusted after the publication of this report. There can be no assurance that the future performance of any specific investment, investment strategy, or product made reference to directly or indirectly in this communication will be profitable, equal any corresponding indicated historical performance levels or be suitable for your portfolio.

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