Semiconductors Remain Under Pressure

The semiconductors have usually been called the leading sector of the NASDAQ Composite. Many traders believe that whenever the semiconductors lead technology higher this is a sign of strength in the market and that the NASDAQ Composite will usually lead the major stock indexes higher. Recently, over the past three trading session the Semiconductor Holders Trust (NYSE:SMH) has come under pressure. This ETF will hold a basket of the leading semiconductor stocks.

When the SMH declines it is usually a good chance that most of the leading stocks in the sector are declining. The SMH has not tagged it’s daily chart 50 moving moving average since September 23, 2010 when the SMH began to break out. Therefore, the SMH is now long overdue to decline into that 50 moving average level. Traders can watch for some minor daily chart support around the $34.50-$34.00 area on the SMH. Below are the top 10 holdings of the Semiconductors Holders Trust (NYSE:SMH):

Top 10 Holdings (93.69% of Total Assets)
Company Symbol % Assets
Texas Instruments TXN 21.78
Intel Corporation INTC 18.04
Applied Materials AMAT 11.99
Applied Materials AMAT 11.20
Altera Corporation ALTR 7.00
Analog Devices ADI 6.69
Linear Technology LLTC 4.80
Xilinx XLNX 4.66
KLA-Tencor KLAC 4.10
Broadcom Corporation BRCM 3.43

Source: Yahoo Finance

About Nicholas Santiago 576 Articles


Nicholas Santiago started trading in 1991. In 1997, he became a licensed Series 7 and 63 registered representative. He managed money for a large, affluent private client group. After applying his knowledge to his client base, he decided it was time to begin teaching those interested in learning his methods. He is an expert in Technical Analysis. He has become an accomplished technician in the studies of Elliot Wave, Gann Theory, Dow Theory and Cycle Theory. In 2007, he partnered with Gareth Soloway to form InTheMoneyStocks.Com and realize his dream of educating others about the truth of the markets.

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