Semiconductors are well off their long term trend line and quickly approaching the upper/faster trend. I'm quite positive this is the warning Michael Burry was talking about in his recent twitter post.
I'm speculating the green path is actually more likely than not and if semiconductors take that that path, then we're in for an extremely large drop similar to 2022. The S&P Technology sector index (S5INFT) is currently well above it's fast trend line similar to post covid.
*If* the major resistance at 6975 takes over this could lead to a more reasonable trend and avoid such a large downtrend later.
I'm noticing that below current prices there hasn't been really any support made since 5478 in August, which is why I'm noting that as an important area that *if* there's a pullback that will likely be a smart area to buy.
Ultimately, like Burry is speculating there's a bubble, I'm also concerned about the eventual drop to that lower trend line. Currently because brokers margin account levels hasn't shown any real acceleration (like it did post-covid) I'd be inclined to speculate the bubble is just starting and the more extreme move is going to occur (the green path). Also hits of the lower trend line tend to be spaced out over many years. However it plays out, I'm inclined to save most of my capital for when semiconductors hit that lower trend line.
I'm speculating the green path is actually more likely than not and if semiconductors take that that path, then we're in for an extremely large drop similar to 2022. The S&P Technology sector index (S5INFT) is currently well above it's fast trend line similar to post covid.
*If* the major resistance at 6975 takes over this could lead to a more reasonable trend and avoid such a large downtrend later.
I'm noticing that below current prices there hasn't been really any support made since 5478 in August, which is why I'm noting that as an important area that *if* there's a pullback that will likely be a smart area to buy.
Ultimately, like Burry is speculating there's a bubble, I'm also concerned about the eventual drop to that lower trend line. Currently because brokers margin account levels hasn't shown any real acceleration (like it did post-covid) I'd be inclined to speculate the bubble is just starting and the more extreme move is going to occur (the green path). Also hits of the lower trend line tend to be spaced out over many years. However it plays out, I'm inclined to save most of my capital for when semiconductors hit that lower trend line.
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