Round Number Rescue?
The semiconductors are a huge part of the technology sector and many look for clues in the space to judge not only the sector but the overall market too. One of the biggest news stories regarding the group was the Samsung news regarding piling up inventories. There have been some name changes within which I have always been skeptical about, with AZTA the former BRKS, and WOLF being the former CREE. But the ultimate arbiter is PRICE action, and if we compare recent returns for the SMH against the IGV we see the SMH lower by 4% over the last one month period, whereas the IGV has gained 7% (over the last 3 months the SMH has dropped 22% while the IGV fell 15%). This week kept true to form with the IGV more than doubling the advance of the SMH rising more than 9%. But looking at the chart below of the SMH one can see it bounced off the very round 200 number last Friday. A gap higher next week would register a bullish island reversal after the gap down on 6/10.