This week volatility increased by the second half of the week. Like during week 35 it increased to over 20 on the VIX CBOE. This was anticipated since this weeks numbers sort of promised volatility. Since 8/27 NVDA has been in decline and the Technology Sector as a whole. Let us take a look at Semiconductors:
SOX ETF down -24% from the highs, NVDA -28%, AMD -42%, AVGO -25%, ARM -39%, SMCI -65%!
When looking at the plain numbers it seems NVDA and AVGO are best suited for a bounce when this sell off ends. Anyways these stocks are showing substantial losses in their shareprice and marketcap.
And still the hope is there for the AI and Semis to save the world. Amazing! (AI can be of good help for disabled persons and that is perfect) However if we reach oversold areas under RSI 30 it can be time for a bounce in these techstocks. Maybe starting at the end of the coming week. But it depends on the numbers reported next week. We have the ISM Manufacturing Index on Tuesday, ISM Non-Manufacturing Index on Thursday and Non farm payrolls on Friday. That is important numbers. We also have major banks like BoA talking positive about NVDA. A major correction in the stockmarket will pave way for the Fed to cut rates. But lower rates is no guarantee for a new upleg in stocks. It might be very short-lived and the market will start asking for more help. You see the setup? We don´t know anything yet. We have to look at charts and follow trends.
The trends are hard to find right now when many Sectors are at ATH. It could not have been a tougher time for me to start this trading blog. Stocks barely make it to a new Weekly before trend changes.
That is why we have the 1-2-3 Method! And that is why we also invest longterm in Resources and Gold.
In this Weekly update you can read about alternative Sectors in the North American stockmarket!
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