In mid-March, I warned that investors should “watch those divergences” on the Nasdaq. Well, those bearish divergences have helped to form another bearish pattern that investors need to keep an eye on.
And this pattern will likely determine whether or not investors “Sell in May”.
Today’s chart 2-pack includes the Semiconductors ETF (SMH) alongside the Nasdaq 100 (NDX). As you can see, both indices have formed bearish head and shoulders patterns.
BUT they will only prove to be bearish IF the neckline is broken to the downside. So all eyes should be on the green line in the charts below. Tech stocks are giving investors reason for pause here… and will likely determine what’s next for the correction. Stay tuned!
Monday 2-Pack: Semiconductors (SMH) & Nasdaq 100 (NDX)
CLICK ON CHART TO ENLARGE
This post was originally written for See It Markets.com