With QQQ & SPY still holding above last Monday’s lows and even the top of Monday’s gaps (which I had stated earlier was key support that needed to be taken out to spark the next wave of impulsive selling), I could be jumping the gun on this one but based on my read on the charts as well as the recent price action over the past several trading sessions, I have decided to add SOXS (3x short semiconductor sector ETF) as an official Short Swing Trade around current levels. One could also wait for a solid break below the tops of Monday’s gaps in SPY & QQQ (around 288 & 183.50ish) before shorting the semis which would provide a higher-probability entry albeit, most likely at a less favorable price.
The price targets are the same on the last update on SOXS last week with T1 at 53.79, T2 at 59.31 & T3 at 67.10./ However, I have raised the suggested stop to any move below 44.90 based on the fact that SOXS has risen since then. The suggested beta-adjusted position size for this trade is 0.35.
Note: One would buy or go long SOXS in order to short the semiconductors. However, as a short on the semis, this trade will be assigned to the Active Short Trades category. One could also opt to short a typical (0.9 to 1.o BAPS) of SOXX in lieu of buying SOXS.