SOX Semiconductors Daily Chart; Sideways Symmetrical Triangle

The sideways symmetrical triangle pattern remains in play for the semiconductors. SOX lost -1.2% last week. On the daily chart above, price bounces off the lower rail of the blue triangle. The triangle pattern is strong with 8 touches since June. Price has to make an up or down decision since it is in the apex of the triangle and out of space over the next two weeks.

SOX begins the week at 1367. The 50-day MA is 1370. The 20-week MA is 1370. Keybot the Quant is currently short the market and tracking SOX 1370 as an important bull-bear line in the sand. It appears that 1370 is key and with price only 3 points away, the chips will dictate stock market direction on Monday morning. As the chips go, so goes the markets. The battleground is SOX 1370.

The bulls are jamming NVIDIA higher proclaiming it as the top chip-maker for the growing AI (artificial intelligence) space. The professional traders and money-managers already know this and the stock appreciation reflects this expectation. NVDA pops +6.66% last week on the hype. The smart money is getting Joe Sixpack all excited about NVDA and AI so they can distribute shares to this future bagholder.

For the triangle, the vertical side is 160 points (1280 to 1440). Thus, if price collapses out the bottom of the sideways symmetrical triangle at 1350, price will seek 1190. If the SOX breaks out higher out of the triangle at 1380, price will seek 1540. The stakes are high. The chips must make a major decision over the coming days and obviously the broad stock market will follow the chips. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.

Note Added Tuesday, 10/2/18, 7:42 AM EST: SOX leaps higher yesterday sending the stock market higher, however, as the session played out, the chips rolled over to the downside and ends the day at....... wait for it....... wait a little bit longer for it ........... 1370. The battle continues. Note how price came up to 1382 for the HOD testing the upper trend line of the triangle pattern but was spanked back down. There are now 9 touches of the outer rails that form the sideways symmetrical triangle bestowing more importance on the pattern.

Note Added Sunday, 10/7/18: The chips have fallen apart. SOX is at 1316.