This week’s TPA-RRG report finds SMH (SEMI) ranked #3 out of 27 sectors. SMH has now ranked 3 or 4 in the past 4 weeks. The RRG for U.S. sectors (below) shows that SMH is in a perfect position to continue to outperform, having worked its way out of the Lagging quadrant, through the Improving quadrant, and just entering the Leading quadrant.
The chart of the ratio SMH/SPY has broken out of its steep 1-year downtrend and is poised to move higher (chart 1). Chart 2 shows that, even after the recent rally, SMH is still down 33% in the past 12 months, whereas SPY is only down 19% in the same timeframe.
TPA has identified 6 stocks that show large upside potential and have recently broken out from their long-term downtrend. They are ASML, AMAT, INTC, AMD, TER, and SWKS. The charts at the bottom of the report show their positive potential in 3 ways.
ASML, AMAT, INTC, AMD, TER, SWKS
- The following 2 charts show a basket of the 6 SEMI stocks as they move above the long-term downtrend line.
The following 2 charts show the ratio of the 6 SEMI stock basket/SPY (S&P500). Like the ratio of SMH/SPY, the 6stock basket/SPY has also broken out. as they move above the long-term downtrend line.
Finally, TPA provides the charts of the 6 focus SEMI stocks below. Each one has risen above its steep long-term downtrend; leaving a lot of upside potential.
Jeff Marcus founded Turning Point Analytics (TPA) in 2009 after 25 years on trading desks and 13 years as a head trader to provide strategic and technical research to institutional clients. Turning Point Analytics (TPA) provides a unique strategy that works as an overlay to clients’ good fundamental analysis. After 10 years of serving only large institutions, TPA now offers its research services to mid and small managers, RIA’s, and wealthy sophisticated individuals looking for a way to increase their returns and outperform their peers.
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