New Frontier in Chip Crisis: YZD Semiconductor ETF Nears 30% Decline

The YZD Semiconductor ETF (SOXX) has experienced two 30-35% declines in the past three years. Currently, the 50-day moving average is showing signs of decline, with the 20-day moving average also beginning to roll over. The PPO indicator is hovering just above zero. This signals growing concerns about a potential downturn.

■SOXX is approaching levels where past declines have reached around 30%.

■Major Wall Street players are selling shares as the downturn begins.

■Chip manufacturers are using their high-priced shares to build new factories, signaling future price drops and shrinking Wall Street profit margins.

■The heavy weighting of tech stocks in benchmarks makes the broader market vulnerable to this downturn.

Markets are questioning whether this chip crisis will result in a 'pause that refreshes' or a deeper plunge. The ECB's rate path and Eurozone inflation add to these risks.