Mid-Air
This could be all there is for the SOXX.
If price action can’t continue higher from here, we could have a significant reversal (not advice, not a recommendation).
Stay Tuned
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The Danger Point®, trade mark: No. 6,505,279
Big Reversal?
It was a very busy Friday, hence the reason for the late update.
One short position closed (SOXS-25-10) and five more opened.
Cisco Systems was one of those five (not advice, not a recommendation).
Earnings for CSCO, were released in mid-august; market reaction was a swift move lower.
From the earnings, everything seems to be good.
However, at this juncture, that’s not what the market is saying (at least for now).
Cisco Systems CSCO, Daily
Note:
As a general rule (for my firm), on any initial position, the implied stop for that position is that day’s session high or low depending on long or short.
In the case above, that means a ‘buy-to-cover’ stop at the day’s high of CSCO 68.10 (not advice, not a recommendation).
Other (short) positions to be reviewed over the weekend.
Stay Tuned
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The Danger Point®, trade mark: No. 6,505,279
Watch for Tomorrow
As of this post (6:41 p.m., EST), Broadcom (AVGO) is trading up about 11.50-pts at 317.6, after its earnings release, link here.
That level is just above the all-time (regular session) high of 317.35, posted on August 13th.
In the SOXX, Broadcom is No.2, market cap, right behind Nvidia. So, the SOXX, is up as well in the after-hours.
It’s interesting to note that sister-stock, Nvidia has not rallied in sympathy.
In fact, it’s trading slightly lower after-hours.
As the tagline says, we’ll be watching closely tomorrow.
Stay Tuned
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The Danger Point®, trade mark: No. 6,505,279
… And The Hard Place
As the chart shows, the SOXX has been struggling for weeks in the resistance zone.
From that chart, one question to be asked, did the overnight and early session fill the gap?
The other question, did the Nvidia earnings release change the dynamic of the sector?
Reading price action since then, in real time, the answer seems to be yes (not advice, not a recommendation).
Semiconductors SOXX, Weekly
As of this post (10:35, a.m., EST), the SOXX is struggling to post higher … but it’s not happening.
There’s a lot of congestion around the resistance zone. In Wyckoff terms, he calls this price action ‘Cause’.
Meaning, that if we break materially lower from here, it’s called ‘Effect’.
His point being, since there’s sufficient cause for a sustained move, if/when it happens, we’re to expect a corresponding effect (not advice, not a recommendation).
Stay Tuned
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The Danger Point®, trade mark: No. 6,505,279
Then, The Fed
There are four more trading days left to compete the bar on the 8-Day, chart of Nvidia, below.
What are the chances it continues on higher into resistance?
If it does, it’s the 50% retrace of the entire move from highs on January 7th, to the lows of March 11th.
Then, The Fed
We have a Fed meeting this coming week, 18th and 19th.
Could any announcement be used as an ‘excuse’ to propel the market higher … straight into resistance?
Nvidia Fibonacci 8-Day
Who uses an 8-Day chart?
Not anybody I know 🙂
If Nvidia continues to rally, one would expect the SOXX, to move higher as well … potentially creating yet another short opportunity (not advice, not a recommendation).
Lastly, Ed Dowd
Here’s a link to a recent interview. At time stamp 37:48, he spills the beans on The Fed.
Stay Tuned
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The Danger Point®, trade mark: No. 6,505,279
Holding Below Support
Holding on for its life, just below support.
That’s the current condition (as of 12:23 p.m., EST) of the SOXX.
When we look at the chart, penetration of a three-month support area is clear.
By definition, when support is penetrated, it puts the market in Wyckoff Spring condition; there will (typically) be some kind of attempt to rally.
That’s where we are now.
Semiconductors SOXX, Weekly
Note the black dashed trendline.
Research done on bubbles past, link here postulated at the break, the multi-year down leg begins (not advice, not a recommendation).
After the SOXX broke the trendline, it spent an incredible 10-weeks testing that break before reversing lower.
Positioning
From a price action standpoint, there’s nothing (yet) that says to exit a short position (not advice, not a recommendation).
Stated above, SOXX is technically in ‘spring’ position, ready to move higher.
With that in mind, the stop for SOXS-25-09, has or will be moved up to the session low; currently at SOXS 22.31 (not advice, not a recommendation).
Update: 1:39 p.m., EST: Price action expected to continue unabated (downward) after the first half of the session, now showing some buoyancy: Discretionary exit of SOXS-25-09, profit +14.2%
Stay Tuned
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The Danger Point®, trade mark: No. 6,505,279
Well, That’s It
At the open, Nvidia came within 1-point of the target (61.8%), shown in the last update.
Then, it posted an outside-down bar within the first 25-minutes.
At this point (as of 11:28 a.m., EST), since yesterday’s low was penetrated, that puts NVDA, in a minor Wyckoff Spring condition, retracing some of the early session down move.
Nvidia NVDA, Daily
The chart has been compressed, showing events appear to be taking place on a massive scale.
If the trading channel is in-effect (i.e., correct), look how far down we have to go for the ‘demand’ side.
The press and pundits are either not ready for such a move or are deflecting from actual events, links here and here.
Looks like ‘good enough’ didn’t last long:
At the open, NVDA down, immediately.
Positioning
With all the coverage put on this equity and sector, ETF, the SOXX, trading actions are matter of fact.
The sidebar shows another short via SOXS, opened early in the session. Trade is SOXS-25-09 (not advice, not a recommendation).
Stay Tuned
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The Danger Point®, trade mark: No. 6,505,279
Rally Into Earnings, (maybe) Good For Shorts
Yesterday’s post said to “expect a test of … support.”
That’s what we got.
Price action sliced through support levels for Nvidia and then rallied into the close.
This morning’s action continued that rally.
Short position SOXS-25-08, was exited early in the session (when SOXX, daily high exceeded yesterday’s high) with profit at +19.4% (not advice, not a recommendation).
Nvidia NVDA, Daily
Today, is Fibonacci ‘Day 34’, from the all-time highs.
Tomorrow, is Day 8, from the 2/18/25, pivot high.
Earnings are scheduled for release at 4:20 p.m., and conference call at 5:00 p.m., EST.
Stay Tuned
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The Danger Point®, trade mark: No. 6,505,279
Who’s Is Taking Your Trade?
As a trading professional, you must know (or have a good idea) who’s on the other side of your trade.
Whom are you competing against?
It’s just one of many questions to be asked (along with price action) when estimating the opportunity; whether long or short.
Well, ladies and gentlemen, here’s some of what’s on the bullish side of Nvidia, link here.
So, according to the video, tech stocks (and Nvidia) went down because of the U.S. 10-yr Treasury?
Think about it. ‘Likes’ vs. ‘Dislikes’ on that video (as of this post) are over 13:1.
How about this:
Nvidia went down because it posted the largest ever price action down-thrust; then, went through a test of that action, completed the test, then reversed to the downside.
Wow, sounds so clear when put that way. 🙂
With that, let’s get back to reality.
Nvidia NVDA, Daily
Earnings are scheduled for after-hours tomorrow. Things could get interesting.
In the meantime, we have a demand line and possible channel.
As of this post (10:47 a.m., EST), NVDA has sliced through support at the 129 – 130, level with ease.
We should expect a test of that support. However, at this point, price action is quite weak (not advice, not a recommendation).
Stay Tuned
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The Danger Point®, trade mark: No. 6,505,279
Data-Center (lease) Cancellations
One of many to come?
The article at this link says the cancellation move was ‘unexpected’.
Clicking on ‘Artificial Intelligence’, (side-bar) and going back to August of ’23, with this post, then reading though subsequent posts, one can say the ‘cancellation’ was fully expected.
That August ’23, post has the link to Prechter’s analysis; we’re in the largest asset bubble in at least 300 years (not advice, not a recommendation).
All of that brings us to chief cook and bottle washer, Nvidia.
Nvidia NVDA, Daily
We’ll cut straight to the chase (as of 11:35 a.m., EST).
A Fibonacci projection is overlaid starting from the all-time-high (1/7/25), to the recent lows (2/3/25), back up to test (2/18/25), then reversal, again.
Note how last Friday’s price action printed and closed near the 23.6, Fibonacci projection.
Positioning
Everyone has their own preference and style.
As stated in the ‘About‘ section, this site works to emulate behaviors of the three masters listed.
That, in addition to the once-in-a-lifetime opportunity to have been mentored by the late David Weis, results in what’s available on this site.
With that said, positioning in the SOXX (the A.I. proxy) is short, via SOXS, as SOXS-25-08, initial entry link here (not advice, not a recommendation).
Note: SOXS-25-08, stop to be moved to the day’s session low; currently 18.58 (not advice, not a recommendation).
Stay Tuned
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The Danger Point®, trade mark: No. 6,505,279
The Danger Point® 