Elliott Wave Analysis of SPDR S&P Semiconductor ETF (XSD)

If you are an active trader, then you may well have been noticing the recent strength on the semiconductor stocks, particularly stocks like Broadcom (AVGO) Intel (INTC) and Microsoft (MSFT). Although there are a few more semiconductor stocks that have shown strength since the Dec 2018 low, based on the weighting, the stocks listed are the more important stocks to follow in my opinion.

Taking a look at the ETF called XSD, it's pretty much the SOX in disguise, I favor the frenzy and euphoria that we are seeing now, is likely a 5th wave of a large impulse wave from the 2009 low. It's common to see Technology stocks being bid when traders and investors are chasing the market. We saw that into the Oct 2018 high as the FAANG stocks were being bid up. Today it's not so much the FAANG stocks, but the semiconductor stocks, which is very reminiscent to what was seen into the 2000 tech bubble top.

Crossing referencing XSD to the SOX, whilst the SOX remains above 1477 a bit more upside could still be seen to end wave [5] of wave 5, that is approximately the 82.00 - 80.00 area on XSD. However until we see an obvious sign of a reversal on the SOX and XSD, then for now, I would respect the recent strength on the SOX/XSD above 1477/82.00 respectively, although I am actively looking for signs that the move from the Dec 2018 has finally burned out. When it turns and reverses, I suspect we see a swift and fast decline as today's buyers become tomorrows sellers.

SOX

XSD