Software Stalling?
In my opinion, the burden of proof still remains with the bulls for the IGV even with the nice move from 235-300 from last October to this February. The ETF is now coming back into a bullish ascending triangle, which is fine but it must not linger in this area, as bulls need to see a “thrust” off this mid-270s level. Remember “if the train pulls back into the station too long, there is something wrong with the train.” The IGV still can not keep pace with the SMH, and if the latter has to go it alone it could be tiresome, especially as it has been leading for some time. CRM, the fund’s largest holding, will report Wednesday after the CLOSE and it will move the needle as a bull flag has taken shape. MSFT is not doing the space any favors as it continues to bleed following the completion of the bearish counterattack candle from 2/7. ADBE rounds out the top 3 holdings and it has been a mess. A double top from the very round 400 number from the week ending 9/16/22 (falling 24% in the strongest WEEKLY volume in years including early 2020) and 2/3 looms large, and it lost another 10% last week. The IGV feels waterlogged and again has plenty to prove.