Watch These SOXX ETF Price Levels Amid Concerns Over Chip Trade Restrictions

The iShares Semiconductor ETF (SOXX) slumped 7% connected Wednesday arsenic investors locked successful profits amid growing concerns that chipmakers will look heightened U.S. waste and acquisition restrictions and geopolitical tensions, irrespective of which campaigner wins nan November statesmanlike election.

Below, we return a person look nan fund’s play floor plan while besides pointing retired important technical levels to watch retired for amid uncertainty surrounding nan sector.

Technicals Signal Weakening Momentum

Since bottoming retired conscionable beneath nan 200-week moving average successful October 2022, nan SOXX ETF’s value has trended steadily higher, pinch investors utilizing dips arsenic buying opportunities.

Despite nan bullish longer-term value action, much caller technicals connected nan floor plan awesome weakening buying momentum, perchance indicating a tiring trend.

Firstly, arsenic nan ETF group a grounds precocious past week, nan relative spot scale (RSI) made a shallower higher to shape a bearish technical divergence. Secondly, during nan fund’s astir caller limb higher, trading volumes have, for nan astir part, trended lower.

Monitor These Key Areas During Retracements

Amid further retracements successful nan ETF’s price, investors should support an oculus connected 3 cardinal areas wherever it whitethorn brushwood support.

The first level sits astir $230, a location connected nan floor plan that could pull buying liking adjacent a highest that marked nan extremity of an impulsive trending move betwixt October 2023 and March this year.

A adjacent beneath this level whitethorn spot nan money autumn to nan cardinal $180 level, wherever it would apt find important support adjacent a horizontal line connecting 2 anterior grounds highs that formed successful January 2022 and July 2023. Interestingly, this region besides astir aligns pinch nan respected 50% Fibonacci retracement level erstwhile stretching a grid from nan October 2022 debased to this month’s high.

Further trading could lead to a retest of astir $148, a region wherever buyers would look for entry points adjacent a trendline linking aggregate peaks and troughs from February 2021 to October past year.

Watch This Upside Price Target

If nan ETF only has a insignificant pullback earlier moving higher, investors should show nan $292 level.

We task this upside value target by taking nan bars shape from nan fund’s impulsive move higher from October 2023 to March this twelvemonth and use it to April’s swing low. This provides a wide area connected nan floor plan erstwhile nan ETF whitethorn tally into trading pressure, peculiarly if different method indicators are pointing to overbought conditions astatine nan aforesaid time.

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As of nan day this article was written, nan writer does not ain immoderate of nan supra securities.