Our Dow Jones newsletter just went out and inside was a tiny analysis on the Semiconductor sector.
Semiconductor stocks have made a killing since September this year. I recently lightened my positions because of the following chart, and will be looking to re-enter at some corrective lows either this month or January to take advantage of a dual seasonal/cycles top expected in March 2011.
Yes, both seasonals and cycles, which are independent of each other as long as the cycles lengths used in analysis are substantially different than 365 days, suggest a March high. But there are several corrections between now and then, and the current dip is right along with the seasonals, and helped me preserve my profits.
Let’s take a look at the SOX seasonal chart (you can play this with ultra-leveraged SOXL):
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