Chip Stocks Are Poised to Drop. Look at These 2 Charts.

The S&P Semiconductors Select Industry Index is rolling over—and that’s bad news for the broader stock market.

S&P Semiconductors is an equal-weighted index. Unlike the broad stock market indexes, its relative strength has recovered just half of the decline from its 2000 top. Because the index is often a leading indicator for the stock market, its inability to breach resistance indicates that the broad stock indexes will be pulling back in the coming weeks.

The chart below illustrates the weakening relative strength of the group. Against the S&P 500 Equal Weight Index, the semiconductors have formed a rounding top at a 23-year resistance. And while many indexes exceeded their 2000 peaks by healthy margins, the semiconductors’ relative strength recovered just half of its decline from its 2000 peak.

Business Business Latest News, Business Business Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Stocks Poised to Open HigherThe Conference Board reports the September Consumer Confidence Index on Tuesday, and the Bureau of Labor Statistics releases the personal-consumption...
Source: MarketWatch - 🏆 3. / 97 Read more »

2 Charts That Show Semiconductor Stocks Are Poised to DropThe S&P Semiconductors Select Industry Index has topped both price-wise and on a relative basis. That bodes poorly for the sector.
Source: MarketWatch - 🏆 3. / 97 Read more »