Are Semiconductors Poised to Thrive Into Q4?

Although battered, the analyst view on semiconductors remains strong. In August alone, analysts at Cowen & Co. upgraded Applied Materials, Qualcomm, and Microchip Technology, while NVIDIA got a couple of nods from Wells Fargo and Oppenheimer and Advanced Micro Devices got their own upgrade from Goldman Sachs.

Direxion’s semiconductor ETFs, the Direxion Daily Semiconductor Bull 3X Shares (SOXL) and Direxion Daily Semiconductor Bear 3X Shares (SOXS) have both been weak of late, but their fund flows suggest traders are still using them for their intended use. SOXL has $6 million in inflows since the start of July, and SOXS has $10 million in outflows over that same time.

Overall, the worry over tariffs might be premature, and fears about lagging GPU sales to cryptocurrency miners pale in comparison to other areas like video games and automotive systems. While added tariffs would provide some drag to the industry when they take effect in mid- to late-September, their outlook for now remains solid.

One thing that’s also solid: Tariffs or no tariffs, whichever side of the semiconductor trade you’re on, Direxion has the 3X leverage to magnify your exposure and express your confidence.

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