I'm seeing numerous high-quality semiconductor stocks building multi-week bases resembling Cup with Handles / Volatility Contraction Patterns and beginning to tighten around a clustering of their 10d EMA, 21d EMA & 50d SMA. I view this as constructive price action. Several of these stocks are serious players in AI too.
SMH (main semiconductor ETF)
NVIDIA (NSQ:NVDA)
Taiwan Semiconductor Manufacturing Co (NYQ:TSM)
Broadcom (NSQ:AVGO)
Applied Materials (NSQ:AMAT)
https://www.youtube.com/jackcorsellis https://www.jackcorsellis.com
Good spot Jack. There was decent buying of Arm Holdings (NSQ:ARM) yesterday after a results knock back. I suspect a lot will depend on the NVIDIA (NSQ:NVDA) results as a lot of these stocks appear priced to perfection, but that has been the case for 12 months now and doesn’t mean they can’t go higher. It’s a brave wealth manager who shuns this sector entirely.
Indeed. Arm Holdings (NSQ:ARM) looks like laggard to me living below its 50d MA after getting creamed in mid-April. It's displaying relative weakness vs the group (SMH) and its peers. I focus on the stocks in the group with the highest relative strength and preferably 'blockbuster' fundamentals. Solid action for many semis today, especially TSM.
Arm Holdings (NSQ:ARM) shares went up so much at the IPO, l tried to buy some, but not available on my platform for some reason. Now they have come back down, the chart won't look good.
Have you looked at Arista Networks (NYQ:ANET) similar chart to the above?
I think Softbank own 90% of Arm Holdings (NSQ:ARM) shares and it's now post-lockup but, as you say, the chart doesn't look good anyway.
Arista Networks (NYQ:ANET) reported after the close on 7 May and looks strong. Earnings beat by 14% and YoY +39% with sales up 16% YoY. Great post-earnings rally into ATH territory. Short-term looks extended to me. I'll be more interested if there is now a pullback around its 10d/21d EMA. If so, could form a CwH pattern.
Another stock acting well is Micron Technology (NSQ:MU) has a CwH look to it. 2024 EPS estimates + 110% with guidance raised, and 2025 EPS estimates +1732% with guidance raised. Last Q earnings +122% YoY and sales +58% YoY.
Yes Arista Networks (NYQ:ANET) looks extended then so do many US stocks. At least decent profit, no debt and beating forecasts. Some stocks are forming a cup but not a handle but keep on going up. A better value one with a cup is Qualcomm (NSQ:QCOM).
The group started breaking out in the last few days for those who were focused. As mentioned, many were tightening around a clustering of key MAs being the 10d, 21d & 50d in the context of large developing bases. I like it when many stocks from the same group and/or theme are setting up. Got myself positioned in several and also PSTG & DELL. Leading stocks basing around 52-week highs and/or ATHs then breaking out is always a positive sign in my book.
VanEck Semiconductor ETF (NMQ:SMH)
NVIDIA (NSQ:NVDA)
Taiwan Semiconductor Manufacturing Co (NYQ:TSM)
Broadcom (NSQ:AVGO)
Applied Materials (NSQ:AMAT)
Pure Storage (NYQ:PSTG)
Dell Technologies (NYQ:DELL)
Yes some big movements up yesterday in the technology sector. Super Micro Computer (NSQ:SMCI) was up nearly 16%, that looks like after a VCP?
I put a significant emphasis on the relative strength of a stock vs its peers (brother/sister stocks). If you look at the chart of SMCI (top left) it fell off the proverbial cliff losing its 50d SMA and struggled to regain it. On the 15th May there is a bullish reclaim but that's followed by a 'shooting star' on 16th May.
The strength and better trading opportunities, in my view, have been in the likes of NVDA, DELL, PSTG, AVGO, WDC which have shown relative strength vs SMCI and the major indexes. DELL stayed well above its 50d SMA when the indexes rolled over in mid-Apr. Someone, somewhere, for some reason, was supporting the stock in a big way.
At the time of writing I have positions in all (excluding SMCI).
If SMCI can power higher in coming sessions/weeks then form a constructive higher low pullback into key MAs (10d/21d EMA) I might be interested.
Good moves unfolding for leading semiconductors, including the #1 institutional stock NVDA. Why it's important to focus on developing themes and multi-month bases forming. Also related AI theme stocks acting well like PSTG and DELL. I have positions in all three.
VanEck Semiconductor ETF (NMQ:SMH)
NVIDIA (NSQ:NVDA)
Dell Technologies (NYQ:DELL)
Pure Storage (NYQ:PSTG)
