(TQQQ) 3x Triple Long NASDAQ ETF in February. Wait until the end of the month before you buy

If you are looking to go long with the triple leveraged NASDAQ ETF TQQQ, it is highly recommended that you wait until the last week of February.  March and April are, historically, the strongest for the S&P 500. And the NASDAQ usually goes up with the S&P 500. 

February is the lull between the Santa rally and the MArch-April Rally

If you are familiar with the NASDAQ's Santa rally, then you know that November and December are bullish for the tech sector. And, occasionally, that rally can  spill over into January. However, when February arrives, there is a wave of profit taking. And that can mean a 5% to 10% correction on the NASDAQ. That is why it is critical to avoid the NASDAQ during the first few weeks of February.

Finding the perfect entry point for the TQQQ

The first thing you need to do is to wait until after options expirations week. While options expiration week is uaully bullish, the results have been mixed during the second month of the year. Wait until the last week of February and look for two critical of factors.

• Look for the Nasdaq to close above its 20-day moving average.
• Look for the Nasdaq to perform at well as the S&P 500.

When you see both factors line up during the last week of February, then consider going long with the TQQQ ETF. Bear in mind that the NASDAQ, in general, may not outperform the S&P 500. But with triple leverage, you should have some outsized gains. 

Nailing the perfect Exit Point

March and April are usually positive months for all American indexes. However, you need to know that you are risking more with a leveraged ETF, especially a triple leverage ETF like TQQQ. Therefore, you must monitor the markets closely during these two rally months. And you should pay close attention to the last two weeks of April. Regardless of what the market is doing, you should sell by May 1. In both bull and bear markets, the May through October period is not the best time for the NASDAQ. Otherwise, look for days when the S&P begin to roll over, especially at the close. When the S&P violates its 20-day moving average, sell your TQQQ, regardless of what the NASDAQ is doing. Remember, the S&P will be leading this rally so it is the index to watch.

Summary

Wait until the last week of February before going long on the TQQQ. Monitor the S&P 500 as it will be the index leading the rally. Be sure to sell when the S&P 500 closes below its 20-day moving average or on May 1.