The Tech Sector is Due for a Correction
Updated
After explosive growth over the last few years, I think the time has finally come for a larger correction.
Here is why I think so:
1. The main bullish channel has been broken with the selloff that occurred early October and hasn't been able to break through the short term resistance for recovery. We could see another smaller ~10% run if the current support holds, but I don't think there is enough momentum for a breakthrough.
2. The RSI is nearing the correction point relative to the channel it's in.
3. Lastly, the 65 moving average crossed down on the 200 MA, which tells me that we may have topped out.
TL;DR: There may be some more short term upwards movement towards the resistance, however an overall downtrend is likely.
Here is why I think so:
1. The main bullish channel has been broken with the selloff that occurred early October and hasn't been able to break through the short term resistance for recovery. We could see another smaller ~10% run if the current support holds, but I don't think there is enough momentum for a breakthrough.
2. The RSI is nearing the correction point relative to the channel it's in.
3. Lastly, the 65 moving average crossed down on the 200 MA, which tells me that we may have topped out.
TL;DR: There may be some more short term upwards movement towards the resistance, however an overall downtrend is likely.
Note
Reached the shown resistance. Will it turn around now and head back towards the support? Let's wait and see!
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.