Chart of the week – iShares PHLX Semiconductor ETF
Further potential up move for US semiconductors after bullish breakout
Medium-term technical analysis (1 to 3 months)(click to enlarge chart)
Time-stamped: 7 Aug 2022 at 11:30 am SGT
Source: CMC Markets
- iShares PHLX Semiconductor ETF (SOXX), a basket of major US-listed semiconductor stocks that consists of NVIDIA, Broadcom, Intel, and Advanced Micro Devices has rallied by +30% from its current 52-week low of 326.67 printed on 5 July 2022.
- Recent price action on 3 August 2022 has staged a bullish breakout from its former major descending channel resistance in place since its 4 January 2022 all-time of 558.97.
- Integrated technical analysis suggests the corrective rebound phase since the 5 July 2022 low remains intact; watch the 400.70 key medium-term pivotal support for a further potential up move towards the next resistances at 434.50 and 454.60 (200-day moving average, the upper boundary of the minor ascending channel from 5 July 2002 low & the 1.00 Fibonacci extension of the up move from 5 July 2022 low to 21 July 2022 high projected from 26 July 2022 low).
- On the flip side, a break with a daily close below 400.70 negates the bullish tone for a deeper pull-back towards the next support zone of 380.00/361.00 before another potential leg of corrective rebound kickstarts.
- Positive elements; price actions have pierced above and retested its 50-day moving before it rallied by 11% to print a recent high of 423.78 on 4 August 2022, current price actions have started to oscillate within a minor ascending channel, and the daily RSI oscillator has remained above its key corresponding support at the 54% level, it has not shaped any bearish divergence signal as well as has not reached its extreme overbought level of 82% which suggests that medium-term upside momentum remains intact.
How to trade the financial markets
An introduction to spread betting and trading CFDs, with example strategies for every style of trading and the three pillars of successful trading.get this free report
Disclaimer: CMC Markets is an execution-only service provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although we are not specifically prevented from dealing before providing this material, we do not seek to take advantage of the material prior to its dissemination.