Category Archives: NVDA

AI Fails To ‘Follow-Through’

August 15, 2023 By in NVDA, Positions, Semiconductors, SOXS, SOXX 2 Comments

Where’s The Continued Upside?

If it’s a screaming bull market and not a potential reversal, after yesterday’s SOXX launch, you’d expect more upside.

After all, we’ve brought out the big guns for added ‘credibility’:

Dan Loeb, David Tepper, and Paul Tudor Jones piled into Nvidia stock last quarter – and other elite investors joined them

Throw on top, the promise of massive IT budgets:

AI set to unleash an unprecedented wave of spending.

Well, with all of that, we must hike our price target:

NVDA Stock Alert

The hysteria increases ever more when we read, NVDA could move the entire market … just days from now.

That part may actually be true but not the way anybody thinks. 🙂

So, let’s move past the mee-too-ism and focus on what the price action’s actually doing.

You know, like looking at reality.

Semiconductor Leveraged Inverse SOXS, Daily

The short position via SOXS remains intact so the focus is on the SOXS daily time frame (not advice, not a recommendation).

As is typical with the markets, it can be read both ways.

Today’s action was higher (lower for SOXX) but there was no new SOXS daily high.

At the same time, it looks like a trend is being confirmed.

Positioning

Taking the recent analysis all-together, links here, here, here, here, especially here, I’m going with the SOXS trend confirmation.

That is, Inverse Fund SOXS to move higher with Sector Fund SOXX lower (not advice, not a recommendation).

Hard Stop remains at SOXS 9.42.

However, we now have a Soft Stop (trader discretion) @ SOXS 9.93 (yesterday’s low).

Tomorrow’s session has the Fed meeting minutes released at 2:00 p.m., EST.

Stay Tuned

Charts by StockCharts

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®, trade mark: No. 6,505,279

NVDA … Testing The Reversal

August 14, 2023 By in GLD, Gold & Silver, NVDA, Positions, Prechter, South Sea Bubble, SOXS, SOXX 1 Comment

The ‘Downside’ Reversal

The AI, mania’s looking a lot like the hysterical gold bugs from years ago.

Just to remind everyone what it was like.

Gold links below are nearly two years old and $3,000/oz. gold is nowhere in sight:

Von Greyerz: Gold-O-Mania Is Coming!

Gold Breakout Imminent!

Gold shhh…

Gold Probes Multi-Month Highs

“$3000 In Months, Not Years”

Gold & The Dollar Soar

Gold & Crypto Surge

The AI Bubble … Past The Top?

Moving on, this post said as we reverse and head lower, expect the hysteria to increase.

You’ll have to be the judge on whether or not the hype has moved to the next level:

Jim Cramer Thinks

‘Pullback Will Be Short-Lived’

Nvidia jumps 6%

Chipmakers Rally

Tepper’s Appaloosa places big bets

UAE said to buy ‘thousands‘ of Nvidia GPUs

NVDA, Historical Chart

The weekly chart of NVDA from 1/15/99, to present, puts the situation into perspective.

Recall, from a previous post, Prechter indicates, we haven’t been at these extremes in over 300-years.

Positioning

It was a rough day to be short the Semiconductor sector via inverse fund SOXS (not advice, not a recommendation).

However, the position remains intact with Hard Stop unchanged @ 9.42.

In the after-hours (as of 7:03 p.m., EST), inverse fund SOXS continues to edge lower; currently trading @ SOXS 9.78.

The NVDA earnings report is moving ever closer.

Stay Tuned

Charts by StockCharts

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®, trade mark: No. 6,505,279

‘It’s Just a Flesh Wound’

August 11, 2023 By in NVDA, Positions, Semiconductors, SOXS, SOXX, Van Tharp, Wyckoff 2 Comments

So, Now It Starts

It’s like the knight in Monty Python.

We have the usual suspects being rolled out to let us know, there’s nothing to worry about.

Links here, here and here.

This one, is especially ripe.

Watch until the end (if you can stomach it) where the host asks in exasperation, after a 200% gain in NVDA, ‘is there really more upside?’

At this point (as of 11:05 a.m., EST), the answer is no.

Forces Of Thier Own

All the way back in 1902, Wyckoff discovered after studying the tape (the Ticker):

‘Forces were at work, moving prices, that had no connection to real values.’

That, ladies and gentlemen, is all you need to know.

Fundamentals are just a well-orchestrated ruse to keep the public thinking, if their pencil’s sharper than the next guy’s (think FactSet), they’ll have the market figured out.

Wyckoff ‘Nails It’

So, he we are.

Using Wyckoff analysis (reading the tape) the probability for the current reversal, was identified within a day.

The subsequent short position (via SOXS) was stopped out yesterday, almost lost completely, but for the re-entry @ SOXS 9.70 (not advice, not a recommendation).

As of this post, we’re a full point higher at 10.70, an 11%, gain in just hours … not bad.

With that said, we’ll shift gears a bit and go straight to the leveraged inverse fund SOXS, but use a 3-Day chart.

Semiconductors Leveraged Inverse SOXS, 3-Day

The 3-Day, is being used as the market itself has defined (for now) it shows price action characteristics more clearly.

Distance between the entry and the stop is 0.28-pts.

As a position size example:

Risking $1,000 on the trade would result in a size of 3,571-shares of SOXS (not advice, not a recommendation).

For more information on sizing, see Van Tharp, link here.

Note: There’s a big price difference (over 450%) between the Wycoff text and the Van Tharp text … just sayin’.

Next Steps

At this point, there’s not much to do on this trade (not advice, not a recommendation).

Keep in mind we’re at an historic bubble extreme, the likes of which has not been seen since Sir Issac Newton lost his fortune over 300 years ago.

Stay Tuned

Charts by StockCharts

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®, trade mark: No. 6,505,279

The MAERSK ‘Message’

August 5, 2023 By in GLD, NVDA, Positions, Prechter, Semiconductors, SOXS, SOXX

‘He’s Dead, Jim’

What’s the MAERSK message?

The economy has collapsed.

He’s Dead, Jim

But wait! We’ve already written the script on what happens next:

Buy the dip, soft landing, no collapse until after the ‘elections’, stocks to soar, bull market just starting.

The Propaganda, Bot

A Bull Market Is Coming

Morgan Stanley thinks it’s a buying opportunity

Have Patience, Intel Investors!

Is this the crash-proof economy?

Not Time to Worry

The AI, Bot

Meanwhile, the SOXX and its loyal henchman, the AI bot, may have just ‘changed hands’.

Well, actually leveraged inverse SOXS, could be changing hands, shown below on the weekly chart.

Semiconductors Leveraged Inverse SOXS, Weekly

The massive volume in SOXS, over 369-million shares for the week represents (at the closing price) over $3.4-bln.

That may be the inflection point (not advice, not a recommendation).

As a reminder, here’s another example of ‘changing of hands’, link here. Since then, GLD has not topped that level.

Three-Hundred, Three Years (33)

Not since the South Sea Bubble of 1720, has there been an environment such as this.

Reference time stamp 11:10, in the link.

NVDA Earnings, Tick-Tock, Closer

One has to wonder, how NVDA, is going to ‘spin’ its upcoming earnings release and how the market will react.

Will it be, ‘buy the rumor, sell the news’, or just good ‘ol fashioned ‘sell’. Maybe it will be ‘buy, then sell’. 🙂

Who knows but it looks like the rest of the market’s not waiting around to find out (not advice, not a recommendation).

Stay Tuned

Charts by StockCharts

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®, trade mark: No. 6,505,279

It’s Lonely At The Top

July 23, 2023 By in NVDA, Positions, Semiconductors, SOXS, SOXX, TSM, Wyckoff 1 Comment

The ‘AI’ Top

We’re about to find out if last Tuesday, was the top in AI, or just another interim top on the way higher.

No matter the Taiwan Semi slow-down, mainstream media’s not even considering we’re near (or past) a potential long-term reversal.

For this update, the SOXX is being used as proxy for the AI mania. The chief cook and bottle washer in this latest delusion is Nvidia (NVDA), which reached a high on Friday, July 14th.

Basic Indicators, Wyckoff & The Cat

Even without using Wyckoff analysis, basic indicators like MACD, both on daily and weekly are telling us the momentum has slowed; on the daily, it’s outright reversed to the downside.

From a Wyckoff standpoint, we’ve had an up-thrust (reversal) that’s been supported by decreasing up-volume and increasing down-volume (shown on daily, below).

The cat’s out of the bag with Taiwan’s earnings release.

What we have are delays, more delays, coupled with revenue slowdowns (not advice, not a recommendation).

So, NVDA, where’s the money? Where’s that $11-Billion?

Slow, At-First?

If we’re past the top, it could be slow at first. Maybe imperceptible that a significant reversal is at hand.

If that’s the case, it might all change on August 23rd, when NVDA releases its own earnings.

Semiconductors, SOXX, Daily

The daily chart shows we’re holding below resistance (blue line) after an apparent reversal.

The probabilities are accumulating that we’re in some kind of sustainable reversal.

Next week is likely to show us if that assessment is correct (not advice, not a recommendation).

Positioning

Stated previously, this site does not provide advice.

With that said, here’s how it looks on the company’s spreadsheet for shorting the SOXX using leveraged inverse fund SOXS.

Next week’s action is likely to either force an exit of the position or allow for the trailing stop to be increased.

Stay Tuned

Charts by StockCharts

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®, trade mark: No. 6,505,279

AI, ‘Train-Wreck’, Leaves Station

July 20, 2023 By in $SPSIBI, Biotech, Edward Dowd, LABD, NVDA, Positions, Semiconductors, SOXS, SOXX, SPBIO, TSM

Did You See The ‘Elephant’ ?

It’s hidden in plain sight.

Taiwan Semi (TSM) releases lackluster results, revenue slowdown and new building construction delays.

TSM says the delays stem from the inability to find qualified workers.

Edward Dowd provides insight on the overall reduction of employees, in this interview (Time stamp 5:10).

Bull Trap Shut, Train Leaving Station

If there ever was a ‘gotcha’ moment, this is it.

Even while the mainstream continues to tout the hype, here, here and here, the market has reversed (not advice, not a recommendation).

The daily chart of SOXX, has the MACD bearish divergence confirmed. Price action is now (as of 3:05 p.m., EST) well below the breakout (blue line) resistance area.

Semiconductor SOXX, Daily

This site does not give advice, but it can be inferred by reading the reports what actions are being executed (not advice, not a recommendation).

With that said, short positions in the SOXX, via leveraged inverse SOXS, were entered early during yesterday’s session at SOXS 8.54 and SOXS 8.69.

As a side note, within minutes after today’s market open, the gain in the SOXS, fully erased the -7.9% loss via LABD, noted in yesterday’s update.

The Biotech ‘Bid’

For whatever reason, probably to be revealed months or years from now, biotech, the instigator of the ‘elephant’ is not selling off into a market collapse as expected.

Instead, the effects are being played out in low-margin industries like airlines and semiconductors.

Stay Tuned

Charts by StockCharts

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®, trade mark: No. 6,505,279

ChatGPT, Tops-Out

July 8, 2023 By in AVGO, NVDA, Positions, Semiconductors, SOXS, SOXX, TSM

And With That, It’s Over

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.

It’s about to get interesting.

Stay Tuned

Charts by StockCharts

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®, trade mark: No. 6,505,279

Beware … The ‘Ides’ of July

July 2, 2023 By in NVDA, Positions, Semiconductors, SOXS, SOXX, TSM 1 Comment

Well, July 13th, Actually

Thursday, July 13th, is when Tiawan Semi (TSM) is scheduled to release its earnings.

At this point, the date is still an estimate as this link says it could be as late as the 19th.

Either way, we’re going to find out (very soon) if there’s any correlating support for Nvidia’s ‘fantasy‘, $11-Billion.

The historic chart for NVDA (since 1999), shows an incredible rise that has apparently reached a climax top.

That climax is shown by the ‘off-the-chart’ reading of Force Index; never before seen in the 24-years, a near quarter century of trading history.

Nvidia, NVDA Daily Chart, Historical

Moving closer in on the daily, we see the magnitude of the thrust higher.

The gap has been labeled ‘exhaustion’.

That premise is supported by the fact of immense thrust (and volume) higher.

Exhaustion means just that; it can’t be sustained (not advice, not a recommendation).

Stay Tuned

Charts by StockCharts

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®, trade mark: No. 6,505,279

‘Show Me The Money !’ … NVDA

July 1, 2023 By in GDXJ, JDST, NVDA, Positions, Semiconductors, SOXS, SOXX, The Maverick of Wall Street 3 Comments

Waiting, For August 23rd

From a strategic standpoint, this past Friday was the end of the Quarter and possibly the lowest risk spot to short the semis (not advice, not a recommendation).

‘Low risk’, does not mean, ‘no risk’.

We’ll look at the chart below for the SOXX, but first some housekeeping on the Junior Miners, GDXJ.

As stated in the last update, if there was more GDXJ, upside, shorts (via JDST) would be exited. That’s what happened with an overall gain of + 3.57%, on the series (beginning 6/16/23).

Now, on to the next circus … Artificial Intelligence; more specifically, NVDA and its cohort, the SOXX.

Where’s The Money?

With the quarter over, money managers have dutifully shown they’re like everyone else, ‘investing’ in AI.

That’s out of the way, so let’s move on to the specifics:

‘Hey NVDA, where’s the $11 Billion?’

Referring back to the excellent investigation done by The Maverick, in his view, the $11 Billion, is “Fantasy”.

The tricky part from a chart standpoint, is to identify when or if that fantasy is going to be exposed.

Semiconductor SOXX, Weekly (Inverted)

We’ve taken the weekly chart of SOXX, and inverted it as if going long the leveraged inverse SOXS (not advice, not a recommendation).

Downside force dissipating with each major thrust.

Last week was an ‘inside week’; price action could not make a new weekly low.

Couple that with end of quarter, potential ‘window dressing’ and this past Friday, may have been the lowest risk point, for shorting via SOXS (not advice, not a recommendation).

Analysis … not Advice

This site cannot and will not give advice.

What it can do, is provide analysis and strategy so that you can make your own determination on the market.

With that said, the ‘heads-up’ for a top in the SOXX, was posted on June 17th, link here.

Since that time, the SOXX reversed down and has now come back to test.

Positioning

On Friday, the SOXX, was shorted by entering long the inverse fund SOXS, at 10.01.

Soft stop (trader discretion) for the position is the session low at 9.75, and hard stop (no excuses exit) at all-time low of 9.48 (not advice, not a recommendation).

The coming weeks may prove interesting. All eyes will be on that ‘$11-Billion’.

Show Me The Money

Charts by StockCharts

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®, trade mark: No. 6,505,279

The ‘SOXX’ Top

June 17, 2023 By in NVDA, Semiconductors, SOXS, SOXX, The Maverick of Wall Street, TSM, Wyckoff 2 Comments

Was That, ‘THE’ Top ?

Beginning at time stamp 6:24, at this link, The Maverick goes through an investigation into NVDA, projections.

‘Something doesn’t add up here ….’

That report was three weeks ago. What’s happened, lately?

As of the close this past Friday, NVDA, the largest in the SOXX, was at $1.1-Trillion, market cap. A distant second, is Taiwan Semi (TSM) at $545.5-Bln.

Below, we have a confluence of events for the SOXX.

Semiconductor (ETF), SOXX, Weekly Candle

We’re at the top of a trading channel.

We’re in Wyckoff ‘Up-Thrust’ (reversal) position.

A lot of volume expended with less (net) upward progress than previous volume spike; ‘effort vs. reward’.

Getting down to the daily, we see a terminating wedge that’s coupled with reduced volume.

Semiconductor Index SOXX, Daily Candle

So, what does that mean?

The ‘probabilities’ for more upside are, or have been, reduced significantly (not advice, not a recommendation).

Stay Tuned

Charts by StockCharts

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®, trade mark: No. 6,505,279