One of the noteworthy developments in recent days has been the move in semiconductors. After a strong run of outperformance that saw the VanEck Vectors Semiconductor ETF (SMH) soared more than 36 percent in 2017, the ETF gave back most of the early 2018 gains in recent day, up 5.9 percent YTD while the S&P rose 6.2 percent. Now the question is whether recent selloff is a pause that refreshes or it’s a beginning of something worse? Below is an update look at a trade in SMH.
The graphic below is from our “U.S. Market Trading Map”, show the near-term technical bias and trading ranges. As shown, the underlying is in a short-term bullish trend when the price bars are painted in green. The underlying is in a short-term bearish trend when the price bars are painted in red.
Chart 1.1 – VanEck Vectors Semiconductor ETF (daily)
Our “U.S. Market Trading Map” painted SMH bars in red (sell) – see area ‘A’ in the chart. The first dominant feature on the chart is the rising trend line starting in 2015. The second dominant feature of the chart is the sideways trend since early 2018. This week’s massive selloff pushed the ETF down to the 1-year moving average, a key support level…Click here to read more.
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