I have so many charts that I use for NFTRH’s Market Internals segment that I have had to start a new system, color coding the various internals indicators thusly…
As you can see by the yellow highlights, I try to get a couple of charts in there each week as well.
Anyway, here is a chart we began using back in Q4 2017 after I became aware of an utterly repulsive mainstream media article spotlighting a fund manager who was raving bullish the Semi Equipment names for 2018. You can find this info and links in my post linked below.
MSM: “Hey everybody, buy into a completely mature trend because we have history and all those positive perceptions herded to one side of the boat!”
But the media were just doing their job, which is harvesting your eyeballs by tugging at your greed response (just as they tug at your fear response when appropriate). So they had some fund manager (ooh, a fund manager, wow) picking stocks that had long since been played out, AMAT & LRCX and they headlined it…
Fund manager looks beyond ‘FAANG’ stocks and finds even bigger winners for 2018
The Semi sector signal did its job well in anticipating 2018’s Q4 troubles. It did this about a year ahead of time, as we noted 1 exact damn year ago.
Sorry to keep promoting this, but as I recall this website and its resident market report were the only ones (that I know of) giving you this scoop at the time.
Anyway, while I am a little bit short the Semis right now my greater interest is in following AMAT & LRCX for any positive signals, which would theoretically be well before the market’s current travails finish playing out.
But to answer the chart’s question, the 2017-2018 patterns in AMAT/SMH and LRCX/SMH were indeed something worse than just ugly.
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