Category Archives: SOXS

Hanging By A Thread

July 13, 2024 By in Artificial Intelligence, NVDA, Semiconductors, SOXS, SOXS-24-12, SOXX, Up-Thrust, Wyckoff

SOXX Bulls, Lose Their Grip

For most of Friday’s session, SOXX bulls looked like they would make it.

Price action pushed up to within 1%, of a new all-time-high.

Levels threatening the A.I. reversal scenario right up until 30-minutes before the close.

Then, the air came out.

The SOXX, closed up for the day, but just under the breakout, shown in the chart below.

Semiconductors SOXX, Daily

Along with closing below resistance (blue line), price action did so on contracting volume.

Volume contraction implies, commitment to higher prices is weak (not advice, not a recommendation).

Sentiment, Volume, Price

That’s the reversal construct being used on this site.

First, the sentiment, then volume, then finally, the price.

Looking at the 5-Year Weekly chart of Nvidia, we can see it playing out in real-time.

Nvidia NVDA, Weekly

The professionals have already left the chat; storm clouds are beginning to appear.

So far, ‘Week 89’ reversal remains intact.

The Danger Point®

From an engineering standpoint, the SOXX, has met the requirements for a Wyckoff up-thrust (not advice, not a recommendation).

First: Price action posted an outside-down reversal (last Thursday), on increased volume and closed below established resistance.

Second: That reversal was then tested (on Friday) and did so, on contracting volume.

Third: MACD, divergences on Weekly and Daily timeframes; although near-term weekly has yet to tick lower but still (diverging) below the highs of this past March.

    Intuitively, you can feel that something’s up. The A.I. pump-n-dump set-up may have run its course.

    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 SOXX … Day 55 (+2)

    July 11, 2024 By in Artificial Intelligence, NVDA, Semiconductors, South Sea Bubble, SOXS, SOXS-24-12, SOXX 1 Comment

    Margin of Error

    If you’re upside down in a diving stall, shown here, there’s no margin for error or you’re dead; literally.

    The big problem for engineers, it doesn’t work that way in the markets.

    Two days after this post, we have a potential reversal in the SOXX (not advice, not a recommendation).

    Of course, the engineers have long since left the room as there was an ‘error.’; not getting the (potential) reversal exactly right.

    If the AI mania is over, that update two days ago was off by two-days; the biggest bubble in world history … at least since the South Sea Bubble.

    So, let’s move on to the chart.

    Before we get started, also note, Nvidia has not made a new (all-time) high. This update identified that reversal correctly (so far).

    Semiconductors SOXX, Daily

    As of 11:05 a.m., EST, the SOXX has posted out-side-down.

    When Fibonacci counts get longer, there is more room to be off by a few days.

    If this is the reversal for the SOXX, a two-day margin is fully acceptable (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

    The SOXX … Day ’55’

    July 9, 2024 By in NVDA, Semiconductors, SOXS, SOXX 1 Comment

    New Highs & Fibonacci

    Analysis of Nivida has already shown, the leader of the semis’ being influenced by Fibonacci, link here.

    Now, we have the SOXX about to open at or near new highs.

    What you likely won’t find anywhere else, insight that today, is Fibonacci Day ’55’, from the April 19th, lows (not advice, not a recommendation)

    New highs, Day 55, daily and weekly MACD bearish divergences, potential up-thrust; ‘You make the call.’

    Semiconductors SOXX, Daily

    Pre-market action: Currently (as of 8:42 a.m., EST), trading at 260.40-ish, right at the last top high, 260.65.

    Stay Tuned

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    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

    Nvidia … Still The Leader?

    July 5, 2024 By in Artificial Intelligence, NVDA, Semiconductors, SOXS, SOXS-24-10, SOXX

    Setting The (Reversal) Hook

    Nvidia just posted an Up-Thrust, reversal on the daily.

    The rest of the SOXX, whistles past the graveyard.

    If one looks only at the SOXX, everything seems to be ok; it’s recovering (sort-of).

    However, leader NVDA, may be at The Danger Point®, ready to head lower (not advice, not a recommendation).

    Nvidia NVDA, Daily

    We’ve just had an a-b-c correction from the June 24th lows.

    That correction posted a Wyckoff Up-Thrust with yesterday’s penetration of resistance (blue line) and today’s reversal.

    Note: Both upward moves (wave ‘a’, wave ‘c’) are of equal length but are divergent in thrust energy.

    We’re at the point where anything can happen.

    However, this is the place where risk for being wrong on a short position, is least (not advice, not a recommendation).

    Stay Tuned

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    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

    Set-Up, For Gap-Down?

    June 23, 2024 By in Artificial Intelligence, NVDA, Semiconductors, SOXS, SOXS-24-09, SOXX, Uneducated Economist

    The Key Lies with Past & Present

    This update will show why there’s a probability for lower open, lower price action, and/or ‘island-gap-reversal’, for the SOXX, at the next session.

    With the understanding that ‘anything can happen’, let’s get into the SOXX price action, along with chief cook and bottle washer, Nvidia.

    Market Reversal?

    First off, does anyone expect a significant reversal?

    Following the breadcrumbs, here’s a link from the comments section posted during a livestream by Uneducated Economist; go to Time Stamp 23:45.

    Note: The second link is not from Simon (Uneducated Economist) himself but obtained from snide remarks made to him during his livestream.

    Using the timestamp, judge for yourself.

    My takeaway is:

    They don’t know. The amount of time wasted ‘crunching the numbers’ is mind numbing. Number crunching is easy and that’s why (nearly) everyone does it.

    Reading price action (effectively) is hard and that’s why you’re here. 🙂

    Semiconductors SOXX, Daily Candle

    The chart highlights the ‘island-gap’ potential.

    However, the real story is in the second chart, Nvidia.

    Remember that markets tend to alternate. Last time, is not this time.

    The last time Nvidia had a significant outside-down, it went into consolidation before moving higher.

    Nvidia NVDA, Daily Candle

    Looking at the chart, ‘this time’, is already different.

    From the 10:1 split, to outside-down, is Fibonacci 8-Days.

    Last time there was a wide outside-down (March 8th), the next day was narrow range, volume decreasing,

    This time, we have narrow range, volume increasing.

    The Higher Probability

    Taking it all into account, the higher probability is for continued downside. It’s a probability, not a guarantee.

    If we get upside at the next session, then it’s time to stand aside, re-sharpen the pencil and start looking for another reversal potential (not advice, not a recommendation).

    Stay Tuned

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    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

    A Tale Of Two Tops … Nvidia

    June 22, 2024 By in Artificial Intelligence, NVDA, Prechter, Semiconductors, SOXS, SOXS-24-09, SOXX

    The Rule of ‘Alternation’

    It’s not hyperbolic to say, what’s happening to Nvidia right now, has never happened before.

    As we’ll see on the chart, the market itself proves that point.

    Work has already been done (here, here, here and here) on why Nvidia, may be at a significant inflection point (not advice, not a recommendation).

    Now the smoke has cleared from Friday’s session, we can look at what happened and what’s likely to happen.

    First, we’ll use a Fibonacci 8-Day, chart.

    Why? Because nobody else uses one. 🙂

    Besides being a Fibonacci number (just like the Weekly, at 5-Day), the 8-Day, seems to show the potential better (at this point) than other timeframes.

    Nvidia NVDA, 8-Day

    Let’s go all the way back to the beginning and why the current situation is unique.

    NVDA, started trading the week of January 22nd, 1999.

    During that span, there are no two Force Indicator occurrences (shown below) at this level of energy.

    In fact, there are no Force Index prints at this level, ever.

    The only print that comes close is also shown on the chart, occurring in late May, of ’23.

    An astute observer can instantly see the trouble or potential trouble.

    During the consolidation period from mid-March to late April, Force Index declined and eventually posted negative.

    That temporary wash-out provided fuel for more upside.

    Now, price is rising with force declining, at the same time.

    The inference, the rally is weak if not extremely weak.

    Let’s not forget, the ‘old-timers’ say it’s the biggest bubble they’ve ever seen.

    Couple that with NVDA, having already launched from bottom to top, 1999 – to- Latest Highs, a massive 469,000%.

    Time permitting, in the next update, we’ll look at the potential for an ‘Island Gap Reversal’, in the SOXX.

    Stay Tuned

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    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

    Nvidia Split Top … Part II

    June 21, 2024 By in $SPSIBI, Artificial Intelligence, Biotech, LABD, LABD-24-12, NVDA, Semiconductors, SOXS, SOXS-24-09, SOXX, SPBIO, XBI 2 Comments

    Reversal On ‘Week 89’ ?

    The tape is saying ‘This could be it’.

    No one knows if this is ‘The top’, or just ‘A top’, until it’s all over (not advice, not a recommendation).

    This update for Nvidia, said we’re nearing Fibonacci Week 89 (from the October ’22, lows); look for evidence of a reversal.

    With three-hours left in the session, NVDA is on track (along with the SOXX) to posting a weekly reversal bar.

    Nvidia NVDA, Weekly

    The chart updated to show we’re at ‘Week 89’.

    The fact (minus 3-hours) we’re getting a reversal bar on ‘Week 89’, is potential validation of the Fibonacci count.

    The market itself is telling us where to look.

    With the prior update letting us know the air is going out of support for continued A.I., today’s action may be a significant reversal (not advice, not a recommendation).

    Update: 2:07 p.m., EST

    Housekeeping Note:

    While under no obligation to discuss trades, nonetheless, for those following the biotech short (LABD-24-12), that trade has been exited (for now) with profit (not advice, not a recommendation).

    Stay Tuned

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    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

    ‘Adverse Moves’ … Action Plan

    June 12, 2024 By in $SPSIBI, Biotech, Federal Reserve, Interest Rates, LABD, LABD-24-12, SOXS, SOXX, SPBIO, Uneducated Economist

    What To Do When ‘Whacked’

    The day started out with a bang; market’s up sharply on CPI print.

    One could think, months of biotech (short) analysis, has been blown apart with this morning’s sharp move (not advice, not a recommendation).

    Remember, this update said watch out for ‘French’ guys:

    “However, just like the video snippet in the link above, what looks to be a dramatic conclusion to weeks if not months of work, could be completely derailed by a bunch of ‘French’ guys hanging out in a British castle.” 

    Well, here they are. 🙂

    From a trading, positioning perspective, is it really that bad, what’s going on?

    For that answer, we’re going straight to the hourly chart of 3X Inverse Leveraged Fund LABD.

    Biotech 3X Leveraged Inverse LABD, Hourly

    Early morning price action penetrated the stop level given in this update.

    However, as can be seen, price action behavior of LABD was different than (inverse fund) SOXS, under similar conditions; it did not keep going lower but stopped dead.

    It’s clear, action at this point, is pulling away from the lows.

    Rate Cuts Not

    Way back in January of 2023, this site proposed the ‘rate cut’ discussion was nothing more than a ruse; keeping everybody (the press, especially) busy acting like Pavlov’s Dogs, while the big rug-pull was being set-up.

    With that in mind, here’s the real story of what’s going on (not advice, not a recommendation).

    Positioning

    In a little bit of a market ‘cheat’, LABD is currently trading above the prior stop level.

    At the risk of making a gross trading error, the short position in biotech (via LABD) is being maintained (not advice, definitely not a recommendation).

    However, even as this post is being created (3:15 p.m., EST), biotech XBI continues to erode back into the trading range with LABD, continuing to rise.

    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

    SOXX … Bump & Run

    June 5, 2024 By in Semiconductors, SOXS, SOXS-24-07, SOXX 1 Comment

    Exit Or Not?

    Trader Discretion.

    SOXX hit the stop level (just barely) listed in this post.

    We’ve all heard the stories of getting stopped out just as the market took off.

    Is that what’s happening now?

    From a personal standpoint, I am maintaining the SOXX short (via SOXS), but will have to monitor the action throughout the day.

    If there’s no significant retrace lower, or we post another daily high (low on the SOXS) the trade is closed (not advice, not a recommendation).

    Update: 10:35 a.m., EST

    Trade is exited for now. Watching closely to see if gap is closed or intraday reversal (not advice, not a recommendation).

    Semiconductors SOXX, Daily

    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

    Stops … How & When

    June 3, 2024 By in David Weis, Dr. Elder, SOXS, SOXS-24-07, SOXX 1 Comment

    The SOXX Example

    ‘Set the stop and walk away’.

    Those familiar with the David Weis trading video, know that phrase well.

    The entry analysis is done, the trade entered and now, the management of that trade (not advice, not a recommendation).

    The SOXX & The Stop

    We’re only part way through today’s session; it’s already been a very busy day for the SOXX.

    A gap-up open that was quickly retraced. Now, we’re trading lower, hovering around 231.50

    Elder said years ago, ‘when the market is at a reversal point, there’s a lot of turbulence’.

    We have that for sure in this case.

    Moving on to the chart

    Semiconductors SOXX, Daily

    Stated in a prior update, a short position on the SOXX would have an initial stop of 243.63.

    As a result of this morning’s action, it’s reasonable to move that stop lower (not advice, not a recommendation).

    The reason to move lower so quickly, has been defined by the market itself.

    We’ve already had a sharp opening gap-higher where the bulls (may) have given it all they have.

    That level was quickly retraced, inferring the bears are (now) in control.

    If that level is threatened, SOXX moving higher, then bulls have regained control, likely to move higher, still.

    There’s nothing else but ‘set the stop and walk away’. 🙂

    Of course, if one is using the leveraged inverse fund SOXS for a short position, the stop level chosen would correspond to the SOXX, above (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