With all eyes on Broadcom’s earnings release scheduled for Wednesday, other markets in the sector are giving clues we may be near a reversal (not advice not a recommendation).
One of those, is Texas Instruments.
As can be seen, TXN has failed to move above resistance.
The question for Monday; will TXN quietly retrace upward to test the underside?
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
Like something straight out of The Princess Bride, this morning’s Broadcom (AVGO) explosion, probably doesn’t mean what the ‘investing’ public thinks it means (not advice, not a recommendation).
The link above, tells us AVGO, has launched higher on a ‘bold A.I. forecast’.
A Forecast !!! … what maybe could, or might happen in the future, if nothing bad happens along the way, … maybe.
Well, let’s go to the sector itself, the SOXX, and see what the market’s really telling us.
Semiconductors, SOXX, Daily
The bubble trend break discussed here, remains intact.
Any number of notations can be made on this chart.
There’s a downtrend line from the October 15th high (not shown), with today, as the fourth hit on that line.
The low of November 27th, to today, could be classified as ‘spring-to-up-thrust’.
The list goes on.
However, the main point, and to leverage on yesterday’s update, is this:
If the building blocks of economic activity (Basic Materials) are in a (potential) long-term reversal, how are any of these so-called A.I. ‘data centers’ and the associated infrastructure going to be built?
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
The ChatGPT craze lasted just long enough to ramp Nvidia and the SOXX, to stratospheric levels.
In the coming weeks and months, we’re likely to see who ‘cashed-in’ (a la Elon Musk) and for how much.
When a bull market nears the end of its lifecycle, it tends to thin-out.
As the smaller cap stocks fall away and underperform, they’re sold and that capital’s funneled into the ‘last man standing’; in this case, Nvidia (NVDA).
Broadcom (AVGO) is there as well, but it’s a distant second at 1/3rd, the market cap of NVDA.
Short Positioning
We’re short this sector via SOXS (not advice, not a recommendation) with entries shown in the prior update.
There was a third entry on 7/6 (not shown), but it’s minimal size when compared to the others.
Now, on to the charts
Semiconductor Leveraged Inverse Fund, SOXS
The following chart has the current hard-stop progression and soft-stop (trader discretion) locations.
Moving in closer with the zoom version.
The ‘AI’ bulls are in their brain stem (un-thinking), enabled in their fantasy by articles like this one and this one.
Of course, there’s more like here and here but we get the picture.
Taiwan Semi (TSM) Earnings Date
At the time of this update, TSM earnings date was an estimate, now confirmed as July 20th, before the open.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
The Danger Point® 