They Say You Can't Go Home Again

Putting to one side all of the talk about rates, wages, tariffs, political headlines in general, as well as the price action of the FANGs, plus the swirling headlines surrounding Tesla and Elon Musk, we ought not forget that the semiconductors are still coming to terms with their Dot-com bubble highs. 

As you may know, the chips were at the epicenter of the Nasdaq bubble at the turn of the century, and were also the last major sector to finally make their way back up to those old highs, a feat most other sectors accomplished as far back as 2013. 

Chips, expectedly, faced some overhead supply, which simply means an initial expect pause as prior price level of significance--Overhead supply is nothing remotely close to evidence of a major top, nor any kind of top at all. 

But as we can see on the monthly timeframe of the Philadelphia Semiconductor Index, below, chips have spent most of this year dealing with the prior 2000 highs. There is an argument to be made that whichever way the chips break from here could easily be the key to the rest of the tape, too, headed into the autumn months of 2018.

But as the chips go home again we have a fair amount of indecision in the sector, and that may be spreading to the rest of the Nasdaq, as well.