Breaking News
Investing Pro 0
Cyber Monday Extended SALE: Up to 60% OFF InvestingPro+ CLAIM OFFER

Semiconductors' Market Leadership Reaches Important Trendline Support

By Chris KimbleETFsSep 28, 2022 10:44AM ET
www.investing.com/analysis/semiconductors-market-leadership-reaches-important-trend-line-support-200630412
Semiconductors' Market Leadership Reaches Important Trendline Support
By Chris Kimble   |  Sep 28, 2022 10:44AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
 
SPY
-0.12%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
SMH
-1.37%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

Today we revisit an incredibly important stock market ratio: The VanEck Semiconductor ETF (NASDAQ:SMH) versus the SPDR S&P 500 (NYSE:SPY).

This ratio highlights how an important tech leadership group performs versus the broad market. And considering that tech stocks have led the market higher over the past 13 years, well, it’s important.

We’ve highlighted this ratio several times this year, following its breakdown through price support and its latest test of resistance (before falling again).

Below is a weekly chart highlighting a bearish head and shoulders pattern breakdown formed as a double top at the Dotcom highs. Yikes!

SMH/SPY Weekly Chart
SMH/SPY Weekly Chart

The $SMH to $SPY ratio is testing its long-term trend line support at (1).

The chart has a heavy feel to it, so the bulls are going to need some super strength for the save. Their opportunity is now, and they must begin to see buying. 

Semiconductors' Market Leadership Reaches Important Trendline Support
 

Related Articles

Tim Knight
ETF Focus: Commodities By Tim Knight - Nov 13, 2022 1

Let’s look at a few commodity ETFs together. In general, they have remained in an uptrend for two years. This channel needs to break in order for commodities to start a downtrend,...

Semiconductors' Market Leadership Reaches Important Trendline Support

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Edward Lee
Edward Lee Sep 28, 2022 2:21PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
It is too early to say. The problem for the semiconductor industry is a market issue and competition, the world largest semiconductor market reducing importing from outside and replaced product with domestic made products and also start to export to the international market and this trend will continue will not stop soon
William Taylor
William Taylor Sep 28, 2022 2:21PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
When you're dealing with market balanced sector ETFs, competition isn't the issue.  Where one rises, the other falls, but it makes no difference if you're holding the sector itself.  The dings to the crypto sector have brought down the sexiness of the underlying stocks a bit, but the demand is still there from more mainstream manufacturing.  The real problems are the lingering supply chain issues that have curtailed chip-makers' ability to meet that demand. Regardless of getting murdered on this in the last year, I remain bullish.  The demand for semis is not going to ever go away, but only increase in importance into the future.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email