Top Investing Today
  • Investing
  • Politics
  • Stock
  • Economy
  • Editor’s Pick
  • Investing
  • Politics
  • Stock
  • Economy
  • Editor’s Pick
No Result
View All Result
Top Investing Today
No Result
View All Result
Home Stock

Tech Stocks Take a Breather: Is Now the Best Time To Buy the Chip Dip?

BoldThemes by BoldThemes
June 21, 2024
in Stock
0
Tech Stocks Take a Breather: Is Now the Best Time To Buy the Chip Dip?
0
SHARES
9
VIEWS
Share on FacebookShare on Twitter

Who would have thought a mid-week break would halt the stock market’s winning streak? Maybe the hot PMI reading leaked, or traders and investors felt the stock market was getting so toppy that it was time to take some profits from the high flyers.

No Selloff Follow-Through

Thursday’s selloff impacted large-cap semiconductor stocks the most. NVIDIA, Inc. (NVDA) dropped over 3% and closed the week down just over 4%. Broadcom Inc. (AVGO) has been selling off since Tuesday, ending the week lower by 4.40%.

Click here for live chart.

Thursday’s selloff impacted large-cap semiconductor stocks the most. NVIDIA, Inc. (NVDA) dropped over 3% and closed the week down just over 4%. Broadcom Inc. (AVGO) has been selling off since Tuesday, ending the week lower by 4.40%.

This semiconductor weakness can be seen in the VanEck Vectors Semiconductor ETF (SMH) chart below.

CHART 1. DAILY CHART OF THE VANECK SEMICONDUCTOR ETF (SMH). The bearish engulfing pattern was an indication that further selling is likely to take place, and a reversal could be on the horizon. However, SMH managed to hold on to its 10-day EMA.Chart source: StockChartsACP. For educational purposes.

SMH closed barely above its two-week exponential moving average (EMA). An important point to note is that Thursday closed with a bearish engulfing pattern. It’s only natural for technical analysts to think that the selloff would continue into Friday. It did initially, but reversed, closing with a candlestick that resembled a doji. This indicates investor indecision.

Overall, Friday’s price action was relatively quiet, a surprise after the previous day’s selloff and for a quadruple witching day. This indicates that investors aren’t rushing to sell off just yet. The stock market is still very bullish, for good reason. There have been no signs of any slowing down in economic activity.

If you look at a short-term moving average, such as a two-week (10-day) EMA, it’s clear that the S&P 500 has been trading above it for most of June. The Nasdaq Composite ($COMPQ) displays a similar picture.

Click here for live chart.

Overall, both indexes look like their strong uptrend is intact. The Dow Jones Industrial Average ($INDU) is the one that has struggled lately, although it closed above its 10-day EMA on Thursday and Friday.

CHART 2. DAILY CHARTS OF S&P 500, NASDAQ COMPOSITE, AND DOW JONES INDUSTRIAL AVERAGE. All three indexes have the legs to carry the bull run further.Chart source: StockChartsACP. For educational purposes.

Nothing has changed the bullish sentiment of the stock market. While semiconductor stocks sold off, stocks in other sectors did well. Healthcare stocks such as Gilead Sciences, Inc. (GILD), Sarepta Therapeutics, Inc. (SRPT), and Zealand Pharma (ZLDPF) saw strong gains.

All Quiet On the Weekly Front

There’s not much economic data next week except for the PCE. The bigger attraction will probably be Micron Technology, Inc (MU) earnings. The stock had a nice run from mid-April until Thursday, when it plunged hard following its semiconductor cousins. Wall St. analysts expect $0.51 earnings per share and revenues of $6.66 billion. If MU beats estimates, it could boost tech stocks. Investors who missed out on the chip rally may have an opportunity to buy on the semiconductor dip if MU delivers. Micron announces earnings on Wednesday after the close. It’s all about timing!

Bonds were relatively flat this week after last week’s strong rally. Overall, the uptrend is still in play, with a series of higher highs and higher lows. It’s probably not time to invest in the bond market, but it’s worth watching the price action. It can often act as a leading indicator if it shows a strong move in either direction.

The bottom line: Next week, watch Micron’s earnings results on Wednesday after the close and Friday’s PCE number.

End-of-Week Wrap-Up

  • S&P 500 closes up 0.61% for the week, at 5464.62, Dow Jones Industrial Average down 1.45% for the week at 39,150.33; Nasdaq Composite closed flat for the week; down 0.23% at 17,689.36.
  • $VIX up 4.72% for the week at 13.20
  • Best performing sector for the week: Consumer Discretionary
  • Worst performing sector for the week: Utilities
  • Top 5 Large Cap SCTR stocks: NVIDIA (NVDA); Super Micro Computer, Inc. (SMCI); MicroStrategy Inc. (MSTR); Vistra Energy (VST); Sea Ltd. (SE)

On the Radar Next Week

  • April Case-Shiller Home Price
  • May New Home Sales
  • May Durable Goods Orders
  • Q1 Final GDP Index
  • May PCE Price Index
  • Micron Technology earnings

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.

Previous Post

Why Technical Analysis Does NOT Work for Leveraged ETFs

Next Post

4 Ways To ENHANCE The Moving Averages On Your Charts

BoldThemes

BoldThemes

Next Post
4 Ways To ENHANCE The Moving Averages On Your Charts

4 Ways To ENHANCE The Moving Averages On Your Charts

  • Trending
  • Comments
  • Latest
The Connectivity Standards Alliance Product Security Working Group Launches the IoT Device Security Specification 1.0

The Connectivity Standards Alliance Product Security Working Group Launches the IoT Device Security Specification 1.0

March 19, 2024
Israel says UN ‘deceiving’ world over aid delays to Gaza

Israel says UN ‘deceiving’ world over aid delays to Gaza

March 28, 2024
Conservative backlash to Israel aid bill could force Johnson to seek Democrat support again

Conservative backlash to Israel aid bill could force Johnson to seek Democrat support again

February 6, 2024
Gold and Silver Set to Smash Records: Could 2024 Be Their Biggest Year Yet?

Gold and Silver Set to Smash Records: Could 2024 Be Their Biggest Year Yet?

May 17, 2024
Recession Ahead? Sector Rotation Model Warns of Rising Risk

Recession Ahead? Sector Rotation Model Warns of Rising Risk

0
Amid growing criticism of Biden foreign policy, experts credit wins while leaving room for improvement

Amid growing criticism of Biden foreign policy, experts credit wins while leaving room for improvement

0
Conservative backlash to Israel aid bill could force Johnson to seek Democrat support again

Conservative backlash to Israel aid bill could force Johnson to seek Democrat support again

0
Precision Manufacturing For Sensitive Equipment With CNC Machining

Precision Manufacturing For Sensitive Equipment With CNC Machining

0
Recession Ahead? Sector Rotation Model Warns of Rising Risk

Recession Ahead? Sector Rotation Model Warns of Rising Risk

May 10, 2025
Where the Market Goes Next: Key Resistance Levels + Top Bullish Stocks to Watch Now

Where the Market Goes Next: Key Resistance Levels + Top Bullish Stocks to Watch Now

May 10, 2025
Investment Portfolio Feeling Stagnant? Transform Your Path Today

Investment Portfolio Feeling Stagnant? Transform Your Path Today

May 9, 2025
Which Will Hit First: SPX 6100 or SPX 5100?

Which Will Hit First: SPX 6100 or SPX 5100?

May 9, 2025
Enter Your Information Below To Receive Trading Ideas and Latest News

    Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

    Recent News

    Recession Ahead? Sector Rotation Model Warns of Rising Risk

    Recession Ahead? Sector Rotation Model Warns of Rising Risk

    May 10, 2025
    Where the Market Goes Next: Key Resistance Levels + Top Bullish Stocks to Watch Now

    Where the Market Goes Next: Key Resistance Levels + Top Bullish Stocks to Watch Now

    May 10, 2025
    Investment Portfolio Feeling Stagnant? Transform Your Path Today

    Investment Portfolio Feeling Stagnant? Transform Your Path Today

    May 9, 2025
    Which Will Hit First: SPX 6100 or SPX 5100?

    Which Will Hit First: SPX 6100 or SPX 5100?

    May 9, 2025
    • About Us
    • Privacy Policy
    • Terms & Conditions
    • Contact

    Copyright © 2024 Topinvestingtoday.com. All Rights Reserved.

    No Result
    View All Result
    • Investing
    • Politics
    • Stock
    • Economy
    • Editor’s Pick

    Copyright © 2024 Topinvestingtoday.com. All Rights Reserved.