The Semiconductors Holders Trust (NYSE:SMH) has a very bearish head and shoulders top pattern in place at this time on the weekly chart. This semiconductor sector usually leads most technology stocks higher or lower. While the weekly bearish pattern is in place, ensuring that price closes below the rising black neckline on the chart it is always prudent. This past week the price of the SMH closed basically on the line as shown below, and that does not offer clear confirmation of a close below which would trigger the bearish pattern. Therefore, it is still possible that the price of the SMH could recapture that trend-line and bounce higher. Should the bearish pattern play out on the weekly chart the downside target would be around $20.00 for the SMH. This coming week is expected to be a light volume trading period due to the holiday in the U.S. Please remember that light volume will often favor the upside. Hence the old market adage, never short a dull market.
Comments