Category Archives: SOXX

SOXX … About To Pivot?

May 9, 2024 By in David Weis, SOXS, SOXX, Wyckoff 1 Comment

Downside Energy & Acceleration

It’s been three weeks since the SOXX, competed nearly an 18% plunge that started back on March 8th.

Price has action rebounded since then.

However, in the past several days, it has completed an upside test and now (as of 12:05 p.m., EST) is posting a potential reversal to the downside (not advice, not a recommendation).

The 3-Day chart shows us the prior move had the second largest downward thrust energy, ever, for the index.

Semiconductors SOXX, 3-Day

The last downthrust energy, the largest ever, kicked off a decline lasting from January of 2022, to October the same year.

Moving closer-in on the details we have the following:

Do we have a ‘mini’ Up-Thrust, in the expanded view?

Whether the SOXX, is about to reverse down or not, one thing looks clear, it’s at The Danger Point®

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

Gold Miners … Trap Set?

March 13, 2024 By in $SPSIBI, Biotech, Bonds, GDX, GDXJ, Gold & Silver, Gold Miners, IWM, Life Insurance, MET, NVDA, SOXX, SPBIO, TLT, Wyckoff, XBI 4 Comments

Is The Fear Exhausted?

It’s a confusing time.

Semiconductors with chief cook and bottle washer Nvidia, seem to be reversing. Other sectors like biotech and mid-caps were never part of the mania.

Add to that, biotech and life insurance may be correlated (more on that, in another update).

As the market looks to pivot lower, bonds are also pivoting lower or at least under pressure.

In response, one can say there’s been sort of a panic into the mining sector GDX, GDXJ; like it’s somehow more safe there.

Let’s see if the miners really are the safe-space.

Junior Miners GDXJ, Daily

As the chart shows (as of 12:35 p.m., EST), we’re pushing into known resistance (blue line) at the 37.00, area.

There’s also a Fibonacci time frame. Today is ‘Day 55’, from the December 22nd high.

Not only are we at Day 55 from the 12/22/23 high, but we’re also at Day 21, from the February 13th, lows.

Essentially, GDXJ is about to post a Wyckoff up-thrust condition, the area for potential downside reversal.

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

At The Edge … Biotech

March 3, 2024 By in $SPSIBI, Biotech, IBB, LABD, SOXX, SPBIO, The Maverick of Wall Street, Wyckoff, XBI 2 Comments

Amidst The Confusion, The Biotech Set-Up

Let’s remind ourselves with a paraphrased quote, long ago:

‘Until you can completely ignore the financial press and focus strictly on price action, you will never be successful in the markets.’

Richard D. Wyckoff, circa 1934

New Highs … Except

It’s new highs for the AI insanity; all the while, CEOs and other insiders are cashing out, as reported by The Maverick, and J. Bravo.

Notably absent from this drunken cyber-bash are biotech IBB, and XBI.

Fibonacci Retrace Compete?

Both indexes (ETFs) posted a Fibonacci retrace (from 2021 highs), doing it simultaneously; IBB at 50% and XBI at 38%.

Potential reversal of XBI, link here.

We have below, even more (technical) weight for XBI pivot from up-to-down (not advice, not a recommendation).

Biotech XBI, 3-Day

Attempted breakout above resistance (magenta line) puts XBI, at The Danger Point®

Price action’s hovering above resistance while at the same time posting climactic volume.

Note that it’s just touching the underside of the 38.2% retrace level (blue line).

The last time we had a similar volume climax was the pivot point from down-to-up, in early May of 2022.

Does that mean the current volume spike signals a (potential) reversal from up-to-down?

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

Nvidia … Next Week

February 24, 2024 By in NVDA, Prechter, Semiconductors, SOXS, SOXX

Was That, The Top?

Monday’s open could be important for the mania stricken Nvidia (NVDA).

This site’s not the only one figuring on a top if not the top.

Here’s a link showing typical behavior of previous mania bubbles; all-the-same.

Below, are specific price action behaviors pointing to either a pause with congestion, or outright ‘bubble-pop’ reversal.

We’ll find out soon enough.

Nvidia NVDA, 3-Day Bar Chart

We’re using a three-day chart, showing the magnitude of current thrust energy (mid-panel) and similar occurrence back in late May of ’23.

A lot of things are going on … all at once.

Back as far as 2006, the magnitude of the (two) upward thrust spikes has never happened before.

Is this a last gasp?

Price action reached and pulled-back from the (magenta arrow) channel high. That upward move was launched from an earnings release.

Now, we have two ‘bookends’ of upward thrust but here’s the key; markets tend to alternate.

That means: ‘What happened last time is not likely to happen this time’; Prechter’s rule of alternation.

The SOXX index itself plays a role as it had an ‘outside-down’ print on Friday; otherwise known as ‘key reversal’ or ‘bearish engulfing candle.’ (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

D.R. Horton ‘Rolls Over’

February 17, 2024 By in DHI, GDX, GDXJ, GLD, Gold & Silver, Gold Miners, Interest Rates, NVDA, QQQ, Real Estate, SLV, SOXX, SPY, TLT, ZeroHedge

When Real Estate Goes …

It’s been said, ‘when real estate goes, everything goes’.

Like a slow-motion train wreck, since late January, this site’s been watching the (potential) topping activity of D.R. Horton, DHI.

Now, DHI is reversing; coincident with the housing starts collapse, link here.

D.R. Horton, DHI Weekly Close

We’re right at the top of the ‘terminating wedge’.

Downside penetration and test will provide confirmation of the reversal (not advice, not a recommendation).

The major market indices appear to be topping out as well.

The SOXX, may have reversed. Trading was ‘outside-down’ during yesterday’s session.

The SPY, and QQQ, also posted outside-down.

The potential Nvidia, NVDA reversal (link here) shows that so far, that high has not been exceeded.

Rates Up, Not Down

Adding gasoline to the fire, part of this site’s strategy is rates are going higher, not lower (not advice, not a recommendation).

So far, we see that’s true with long bonds (TLT) reversing to the downside, yet again.

And Then … Gold

Let’s not leave out the latest bullish report on gold (and silver), link here.

Notice the bias … that silver’s cheap relative to gold.

How about the massive, multi-year, ‘non-confirmation‘ between gold and the other monetary metals.

If it was real 1980s style inflation, everything would be moving up in tandem … which it is not; something else is going on.

Is the mining sector, GDX, GDXJ, anticipating a price decline in gold?

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

‘Parabolic’ … Is Now, ‘Reversal’

February 13, 2024 By in NVDA, Semiconductors, SOXS, SOXX 1 Comment

The Top For NVDA?

If yesterday’s NVDA action was the top, we won’t know for sure until a new daily low is posted.

Even then, a new daily low could just be ‘a top’ and not ‘the top’.

Pre-market trading in both NVDA and the SOXX index (ETF) is currently pointing to a lower open; evidence for reversal is building (not advice, not a recommendation).

Nvidia NVDA, Daily

Yesterday’s trading covered a wide “33.6” points; there’s that ’33’ again. 

How many times have we seen that in the markets?

As of this update (8:17 a.m., EST) the CPI reports have yet to be released.

Let’s see if that has an effect on the potential NVDA reversal.

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

QQQs: Hovering Above Resistance

February 8, 2024 By in Nasdaq, QID, QQQ, SOXS, SOXX

Upside Force Evaporates

Has time run out, for the Nasdaq?

We’re still waiting for a more definitive short-sell signal on the SOXX, but it’s the QQQs that may be setting up first (not advice, not a recommendation).

The chart below shows the QQQ’s have essentially stopped dead right above resistance.

Upside force has gone missing.

Nasdaq QQQ, Daily

Price broke out above resistance (blue line) with upside pressure diverging.

Of course, anything can happen, and price could continue to drift higher.

However, if there’s a lower daily low and lower close for the next session, the risk on a short trade via QID or similar, is well established (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.

Nvidia Goes Parabolic

February 7, 2024 By in NVDA, Semiconductors, SOXS, SOXX

Latest Trendline @ 86,000%, Annualized

Any day now, the bubble pops (not advice, not a recommendation).

NVDA, may have even topped-out today (or possibly will at the open tomorrow)

We had at least two recent, ‘mee-too’ recommendations (providing contrarian signals) for the high flyer; links here and here.

As we’ll see in the chart below, NVDA appears to be in a blow-off top with ever-increasing rates of ascent.

Nvidia, NVDA, Daily Close

This is what tends to happen during a mania top.

Obviously, the latest trendline, rising at +86,000% on an annualized basis, is not sustainable for the long term.

At this juncture, anything can happen. 

NVDA, already had a tremendous bull move from the recent lows of October 14th last year (posted low of, 108.13); realistically, how much upside is left?

Depending on tomorrow’s action, we’ll discuss a potential (short-sale) set-up 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 Usual Suspects

December 16, 2023 By in $SPSIBI, AMT, Biotech, BOIL, Bonds, CVNA, DRI, Federal Reserve, Food Supply, Genesis 41, GLD, Gold & Silver, Gold Miners, IYR, LABD, Natural Gas, Real Estate, Semiconductors, SLV, SOXS, SOXX, SPBIO, TBT, TLT, Uneducated Economist, UNG, Usual Suspects, WEAT, Wyckoff, XBI 1 Comment

Everything Happening At Once?

Not in any particular order; not advice and not a recommendation.

No 1. There (still) is no Fed Pivot. Seriously, have rates really, actually been lowered? Everyone has a huge case of ‘normalcy bias’. i.e., what the Fed did last time will happen this time.

The 40-year bond bull market from the 80’s, ended in 2020. We’re in a different paradigm now.

No. 2 Natual Gas UNG, is reversing. We’ll see whether or not there’s going to be a supply disruption.

No. 3 The semiconductors SOXX, now have a monthly bearish MACD divergence; daily and the weekly indicators posting even to prior tops (as of Friday’s close). 

No. 4 Components of biotech index XBI, are being shuffled around faster than deck chairs on the Titanic … or, the Olympic 🙂

Seems like a mad dash to add/remove, increase, reduce equities to prop things up. We’ll see how that turns out. Currently, XBI is right at resistance level, 86.50 – 87.0

Here’s just one example from an index, riddled with equities that have no P/E.

No. 5 Carvana is very close to posting new highs and potentially, running the stops.

No. 6 Has Darden Restaurants, topped out? 

The consumer is certainly tapped-out and no-one ‘needs’ a restaurant.

No. 7 Wheat is reversing; It is and has always been about the food supply.

No. 8 Gold, GLD, is currently not going higher (look at the divergences); silver (SLV) is in a major non-confirmation, down nearly – 55%, from all-time highs.

During the 1980s inflation, precious metals moved (upward) together.

Silver looks like it’s responding to the destruction/collapse of (economic) demand.

No. 9 American Tower (AMT), number two in the IYR index, posts a clear false breakout and reversal. 

If rates really are going (materially) lower, interest rate sensitive real estate should continue going higher, right?

No. 10 Which brings us to the bond market, TLT. 

Price action broke above established resistance, currently hovering above that level. 

It’s at The Danger Point®

We can see the set-up, a price action pattern repeated time and again, between the lower and upper blue lines, called a ‘Spring-to-Up-Thrust.

While the media laughs at the bears, let’s just see how this all works out.

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, ‘Double’ Divergence

December 13, 2023 By in Positions, Semiconductors, SOXS, SOXS-23-11, SOXX 1 Comment

Weekly & Daily … Bearish MACD

With the SOXX at 52-week highs, price breaking out above resistance, Fed announcement hours away, the index is showing signs of reversal, posting a bearish divergence on two timeframes.

Both weekly and daily MACD, show divergence.

Add to that, we now have the best ‘inter-Fed’ market performance since 2009.

Semiconductor SOXX, Weekly

The chart shows we’re at The Danger Point®

As this update is being created, the SOXX is pulling back slightly, from its early session up-side; currently trading (11:45 a.m., EST) near unchanged @ 544.39.

Positioning

As one would expect, short positions are already in-place (not advice, not a recommendation).

Entries via 3X Leveraged Inverse SOXS, @ 7.14 and 7.07; Hard Stop TBD, but likely to be today’s session low @ SOXS 6.97 (not advice, not a recommendation).

As a housekeeping note, all other market positions have either been closed or stopped-out.

At The Extreme

SOXX price action could continue higher from here. 

If there’s even a hint of renewed upside pressure, the existing short position is likely to be closed … quickly, possibly without notice (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