BTIG warns semiconductor stocks face 200-day average test

Investing.com - BTIG said the semiconductor sector faces a test of its 200-day moving average after failing to sustain a bounce from oversold conditions, with the firm maintaining its cautious outlook on the sector.

The PHLX Semiconductor Sector Index (INDEXNASDAQ: SOXX) remains essentially flat after nine consecutive negative days, with its 200-day moving average at 470 appearing likely to be tested. BTIG said the equal-weight semiconductor index (INDEXNASDAQ: XSD) has shown little interest in bouncing off its own 200-day moving average, reducing confidence that SOXX will ultimately hold that level.

The S&P 500 faces a potential second decline of 1% or more in the last five days. S&P emini futures continue to hold their multi-month uptrend, but a break below 7,600 would suggest a more meaningful top is in place.

West Texas Intermediate crude oil rose more than 2%, while 10-year Treasury yields fell by 8 basis points. BTIG noted rates are tracking technology stocks.

Gold broke key uptrend and horizontal support despite lower rates. BTIG said it expects a bigger downside move for gold with 3,500 as a measured objective.

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