TQQQ Shows Bullish Technical Signs but Risks Persist for Long-Term Investors

Technical Analysis

ProShares UltraPro QQQ (TQQQ) closed on June 18, 2025, at $73.46, marginally down 0.14%. The stock is trading above its 50-day moving average ($62.47) and slightly above the 200-day moving average ($71.86), indicating a current bullish momentum within a medium to long-term framework. The Relative Strength Index (RSI) sits at 58, approaching neutral but tilted slightly toward bullish territory, suggesting neither overbought nor oversold conditions. The MACD reading of 3.06 over three months confirms upward momentum, though slowing marginally. The average true range (ATR) of 4.09 implies moderate volatility, which is expected given the leveraged nature of TQQQ.

Immediate support is at $67.94, with key resistance near the current level at $73.56. The recent trading range between $72.85 and $74.95 reflects tight consolidation and a potential breakout zone. Given the resistance at $73.56, the stock may test this barrier in the next session; a decisive close above it could lead to a short-term rally. Conversely, failure to breach resistance may result in a retracement toward support zones or the stop-loss level at approximately $70.69.

For the upcoming trading day (June 20, 2025), the technical setup suggests a cautious outlook with possible attempts to push past $73.56. For the week, monitoring volume trends is critical, as recent volume at 70.47 million is below the 3-month average of 109.88 million, indicating less conviction behind the current price action. If volume picks up alongside a breakout, a sustained upward move toward the year high ($93.79) could materialize; failure to do so could see sideways or slightly bearish trends.

Fundamental Analysis

TQQQ is a triple-leverage ETF designed to deliver three times the daily performance of the NASDAQ-100 index. Its price-to-earnings (PE) ratio stands at 31.90 based on trailing twelve months (TTM) earnings per share of $2.30, which is elevated compared to traditional ETFs due to its leveraged exposure and inherent complexity. The market capitalization is approximately $23.93 billion with shares outstanding of about 326 million, reflecting a sizable but niche investment vehicle rather than a traditional equity.

The ETF’s fundamental value is intrinsically linked to the underlying NASDAQ-100 index’s performance and volatility. Its value proposition primarily suits short-to-medium-term trading horizons rather than long-term buy-and-hold strategies, due to daily compounding effects that may affect returns during prolonged sideways or volatile markets.

Intrinsic value estimation is less applicable in the traditional sense since TQQQ is a leveraged product rather than a company with fundamental cash flow metrics. Its long-term performance potential depends heavily on the continued growth and momentum of the underlying index. Historically, the NASDAQ-100 sector has robust growth outlooks driven by technology and innovation; however, leverage exponentially increases risk and may lead to significant deviations from the underlying index returns over time.

Long-Term Investment Potential

Due to the compounding and decay effects associated with leveraged ETFs, TQQQ is generally unsuitable for long-term investment without active monitoring and periodic rebalancing. Investors seeking exposure to NASDAQ-100 growth would typically consider non-leveraged ETFs for long-term capital appreciation. The structural risk inherent in bootstrapping daily leveraged returns likely erodes value during non-trending markets, limiting TQQQ's role to tactical trading or short-term gain.

Overall Evaluation

TQQQ currently exhibits technical strength with price above key moving averages and momentum indicators supportive, pending confirmation through volume. However, resistance near $73.56 requires validation for a sustained upward move. Fundamental attributes aligned with a leveraged ETF structure emphasize heightened risk and complexity, making it less suitable for long-term holding.

Accordingly, TQQQ is categorized as a Hold candidate, reflecting the mixed signals: technically poised for possible short-term gains but fundamentally constrained for long-term buy-and-hold suitability. Traders with high risk tolerance and attention to market conditions may find tactical opportunities, whereas longer-term investors may benefit from caution given the product’s leveraged decay risk.