Semiconductors just finished the week at their highest price in existence. If you were looking for a reason to be bearish, this isn’t it. Semiconductors are considered to be the “heartbeat” and most important group within the technology sector. Some would also say this current “AI” bull market was started off the backs of $NVDA ( ▼ 2.54% ) which is currently the largest company in the world. With $SMH ( ▼ 1.77% ) closing at new all-time highs on a weekly basis, this tells me the foundation of this bull market is strong.

Why So Important?

Semiconductors power virtually every modern device from phones, laptops, tablets, vehicles, machinery, servers etc. It’s hard to imagine life without them. If Artificial Intelligence is going to be the future, then semis are going to be needed more than ever before. The US government agrees with this, as they have implemented “The Chips Act”, which is a multi-billion dollar investment into semiconductor research and manufacturing plants. Multiple other countries such as China, Japan, India, South Korea, Australia, Canada, Singapore, and Israel, along with the entire European Union, have committed to their own semiconductor strategies. This is as bullish as it gets, and the global arms race for semis is in full swing.

The Charts

Here are several of my favorite setups within the semiconductor space.

Conclusion

Semiconductors are extremely cyclical and critically important to the technology we are all involved in today. With the industry closing at new all-time highs, the economy is stronger than a lot of people realize, while the word “recession” is said a million times on TV (you have to ignore these people). There are also a good amount of setups beneath the surface, that are not major names such as Nvidia, Taiwan Semi, Broadcom etc. Are you bullish enough on semiconductors? Feel free to reach out and let me know your thoughts about all of this. As always, thanks for reading and blessings to all!

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