Software…… Well Soft:
Things that are weak, or strong, usually remain that way a lot longer than we think. Remember trends, to the up or downside, tend to persist more likely than they are to reverse. The John Maynard Keynes adage, the markets can remain irrational longer than you can remain solvent comes to mind. Software has been an anchor of the technology space as judged by the IGV which has been lower by 4% over the last one month period (by contrast the SMH over the same period has risen 5%). Imagine how strong the Nasdaq could actually be if the potent 1-2 punch of robust semiconductor and software action. It is easy to find laggards in the space with recent new issues like VMEO, BMBL, PATH and SGFY all off between 50-60% from their most recent 52-week highs. Others that have been around for a bit longer that are in the same neighborhood from their annual peaks are DOCU, EVBG, TDOC, COUP, and TWLO. As long as software plays an ankle-weight role on technology, market participants will be wary of the Nasdaq’s advance.