Chart of the Day - Wednesday, January 17, 2024

🏆 Today's Chart of the Day was shared by Justin Spittler (@JSpitTrades).

• Over the past three weeks, the Semiconductor ETF ($SOXX) has coiled into a narrow triangle pattern. Pressure is building for a decisive move or trend in either direction.

• This consolidation is occurring above the July highs (yellow line) and the former cycle highs from 2021.

• Earnings from Taiwan Semiconductor ($TSM) could act as a catalyst. $TSM is not a large component in $SOXX,  but it's the 2nd largest in the other popular Semi ETF, $SMH.

The takeaway: Semiconductor stocks ($SOXX) are nearing a decision point after weeks of coiling into a tight range—the direction in which $SOXX resolves will likely set the tone for the broader market.