As we have pointed out several time, the Nasdaq and tech stocks (i.e. Semiconductors) are critically important leaders for the stock market.
And wouldn’t you know it, both the Nasdaq 100 ETF (QQQ) and Semiconductors ETF (SMH) are approaching all-time highs (which mark important resistance)!
Looking at today’s “monthly” chart, it is clear to see that the all-time highs mark important resistance. But we can also see another indicator further below – the “dumb money” confidence indicator.
And that is off-the-charts high! You can see that it is well above the red line (caution).
The next move for tech looks to be an important one. Will extreme dumb money confidence mark a bubbly trading top or will the good times carry on? Stay tuned!
$SMH Semiconductors ETF and $QQQ Nasdaq 100 ETF Chart vs. Dumb Money Indicator
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Editor’s note July 27, 2023 at 2:49 pm central time: image was updated with annotation to flow with text of article.