SMH Daily
This what a drop to the 38.2% Fib line looks like measured from the swing low of March 8. This also corresponds to the top part of a consolidation structure lasting from about April 1 to April 11. The 50% retracement line corresponds to the March 21 top. This level approximately equates to the rising 54 day moving average. A 61.8% retracement is certainly quite possible to something below 108.
SMH Week
I’d like to buy SMH because I thought it was going to 125, but the weekly chart Looks a little ominous with the parabolic rising 13 week moving average. I don’t see a soft landing there but that is an area of congestion going back to 2017. It really doesn’t look like it will be able to break the 52 week average at 102.29.
I think the 50% retracement to 109 is quite likely, and even there there is a risk of a decline to 102 where it would not be easy to sell. At the moment it pays to be patient.
