The month of December has seen the software group shine, even outdoing the robust semiconductor space. It has been helped by the security breaches we hear in the news. The week ending 12/11 witnessed the IGV rising by less than 1%, but the SMH slumped by more than 3%. And last week the SMH rose by 2.2%, well underperforming the IGV’s gain of almost 6%. Most likely it is more a function of the SMH taking a break from a huge November, but remember a ratio chart declares what group is acting better than the one it is being compared to. Both can be acting bullishly, which is the case here. In fact I would give the edge here into year end to semis, as if I did the ratio chart with candlesticks, instead of a solid line, not only is the SMH retesting a cup base breakout but would also be filling in a gap from the 11/9 session. Additionally many software names have rallied more than 40% during the last one month period, including CRWD ZS FEYE and CYBR. Perhaps it is time for the IGV to take a well needed pause.