He’s probably hoping everyone will forget about this idea. -20% lol

Agreed, although I see at least 100% upside in SOXS in the coming months & possibly as soon as with 8 weeks although there is still a some more work to be done on both the semis to firm up that intermediate to longer-term bearish case, including a solid break below the uptrend line off the Dec 4th lows in SOXX, which it is currently testing from above right now, as well as solid weekly closes below both those Dec 24th trendlines & 40-week EMAs on QQQ & XLK. If/when that happens soon, SOXS could run but should SOXX, XLK & QQQ successfully defend those supports on a weekly basis, that could spark a rally.

That is exactly why I think it is a good time to add some short exposure, because of the technical damage that was inflicted yesterday & especially today. Still some more work to be done to firm up the intermediate to longer-term bearish case (as covered in today’s earlier video) but so far, so good.

SPY just fell to the 200-ema with QQQ just a hair above & at the same time that SPY hit the 200-day EMA, it also hit this uptrend line from the Aug lows on this 60-minute chart which I posted in the trading room at the time starting that a minor bounce off that level was likely (and so far has occurred) so now, the next sell signal/bearish event will be a solid break below today’s lows.

https://www.screencast.com/t/Uy5nEppKx

thanks

SOXX which is the 1x (non-leveraged) ETF that tracks the same index as SOXS (PHLX SOX Semiconductor Index). I went with SOXS instead of a short on SOXX for a couple of reasons:

1) Shorting stocks & ETFs is not allowed in IRAs or non-margin brokerage accounts so buying SOXS provides a means of effectively shorting the semis where one might not normally be able to. One could also buy SOXS to hedge against existing long positions on various semiconductor stocks if they didn’t want to see those positions, maybe for tax reasons.

2) Using the 3x leveraged SOXS requires 1/3 less capital to short to semis, freeing up the remaining capital for other future or current trading opportunities.

3) While it is typically not a good idea to hold a leveraged ETF for anything more than a very quick in & out trade due to the potential decay caused by the leverage (see the FAQ question “Is there a disadvantage to holding an ETF for an extended period of time” under the ETF Related Questions tab here on the FAQ page: https://rightsideofthechart.com/frequently-asked-questions/ ), my expectation is that assuming today’s breakdown in the stock market sticks & doesn’t prove to be a whipsaw (false) signal, the ensuing correction in the semiconductor sector is likely to be fairly impulsive & unidirectional, i.e.- a fairly steady & potentially swift downtrend. Should that prove to be the case, the 300% leverage would likely work in favor, instead of against, a swing position on SOXS. I explain how that works in the FAQ above.

Thanks