Markets swooned lower Wednesday and more importantly the Nasdaq sagged the most falling 2.4%. That index has been a leader and the when the tech rich benchmark outperforms its a good sign for the rest of the market. The Nasdaq’s 3 day losing streak, it has now CLOSED upon session lows for 4 consecutive sessions, was its first since the middle of January. The strongest subsector of tech was rattled Wednesday with the chip sector taking a beating. The SMH lost 4.7% slicing its 50 day SMA in the second largest daily volume in the last year with the exception of the 10/10/14 declining 6.6% when bellwether MCHP gave a weak outlook. Perhaps investors should not have been so shocked since the largest component INTC at 17% of the ETF, has looked vulnerable down 3 of the last 4 weeks. It did close right near the round 30 handle which is an important level as it bounced there on 10/15/14 and also the stock closed at that round number after RAISING its outlook citing strong PC demand on 6/13/14. Hmmmm, how quickly things can change. With todays move the S&P 500 is now clinging to .1% YTD advance, and the Dow which we rarely follow is now negative.
This article requires a Chartsmarter membership. Please click here to join.