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Sector Snapshot


I am a guest on Bloomberg radio from 9 a.m. to 10 a.m. EDT this morning, so I shall keep this pretty brief. So brief that I'll let the charts speak for themselves.

Semiconductor Index

The Semis (SOX) are getting ready for a substantial move. As the chart below shows, the key semi index is coming to the apex of the wedge pattern that it has been in since the low last October. Typically, once the pattern is broken, the maximum measured move should be the spread of the pattern, which by my read is about 140 points. The key in my view is to not guess which direction the break out of the wedge will occur. If what I said holds true, then there should be plenty of room to be long or short after the pattern is broken.


The PHLX Bank Index (BKX) could go either way by 50 points and still be in the trading range. At this point the closely watched financial index has had a substantial move off the low and is moving into some pretty significant overhead resistance. In my view, there is an equal chance for a move to 800 or 680. If there was a gun to my head, I would say 51% vs. 49% chance of 800 vs. 680 just because of near-term momentum.


The PHLX Gold and Silver Index (XAU) is holding near-term support and bouncing. Not too many folks are expecting a bounce in gold due to good news on the war front. Truth be told though, the XAU has bounced off support despite pretty clear indications that the war is coming to a rapid conclusion.

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Yo Toddo, I patiently wait for you to be inducted to the Baldies gang. Howz that shower drain lookin?!
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